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Ministry pushes for lower Chinese import taxes
The Ministry of Industry and Commerce will continue negotiations with Chinese officials to remove or lower taxes on some agricultural products exported to China.
“China already offers tax exemptions or reductions on over 300 types of goods imported from Laos,” said Minister of Industry and Commerce Dr Nam Vinhaket on Friday at the Lao Indochina Group's (LIG) annual meeting in Pakngum district, Vientiane.
“However, standard taxes remain on the export of cassava powder, rice, maize, coffee and sugarcane produced in Laos,” Dr Nam said.
LIG is an agricultural processor that exports cassava powder to China. It wants to see China reduce taxes on the import of its products and has sought assistance from the ministry to address the issue
LIG Chairman Mr Sengmaly Sengvatthana said “Currently we pay 11 percent tax on our products exported to China, while Thai and Vietnamese producers pay only 5 percent.”
The company is facing difficulties competing in international markets due to various reasons, including increasing transportation costs.
“If we sell our products at high prices we can't compete in the market. If we sell at low prices our profit is eroded and we still face high tax payments,” Mr Sengmaly said.
“At present we are at a disadvantage in the international market.”
The ministry has ap proached China regarding a reduction in import taxes on several occasions. However China has so far refused to grant further tax reductions because “it is a World Trade Organisation (WTO) member and has to conform to inter national trade regulations,” Dr Nam said.
“However, Laos is not a WTO member so our negotiations are at differing levels.”
The ministry plans to re-enter negotiations with China using the Asean-China Free Trade Area as a platform, under which China granted tax exemptions on various Lao products in a January 2010 agreement.
“We also plan to raise China's trade policies with countries in the Mekong sub-region during the negotiations,” Dr Nam said.
Laos is currently preparing to become a WTO member. “Once we're a member, we'll be able to make trade negotiations through the WTO system,” Dr Nam said.
The nation's preparations to enter the WTO are progressing well and the parties involved are now carrying out the final steps of the process, a ministry official said at a recent training course on political theory and administration at the Mass Media and Culture Institute in Vientiane.
Laos first submitted its proposal for WTO membership in July 1997, after becoming a member of Asean. Most other Asean countries are already members of the global trade group.
Vientiane Times
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