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Investors call for clearer ruling on land change fee
Agroup of Japanese investors has urged the government to make clearer its ruling on the change of land classification fee to ensure it is effective and just.
The investors want the government to amend Presidential Decree No. 03 on state service fees, particularly regarding the fee for changing land classification from agricultural land to industrial land.
The decree only prescribes a fee for the conversion of agricultural land into commercial land, which puts a cloud over the intentions of Japanese investors wishing to reclassify agricultural land as industrial land.
The investors said the fee for changing agricultural land to industrial land is the same as for changing agricultural land to commercial land, and that this fee does not reflect the economic conditions in Laos.
They said the government should lower the fee to change the land classification as one measure to reduce investment costs and attract more foreign investors to Laos.
Officials from the Ministry of Natural Resources and Environment have acknowledged that there are problems with land classification fees, which they will report to higher authorities in hope of getting them revised.
The government chose to impose a high fee on individuals and companies who want to use agricultural land for commercial purposes in order to protect the land amid rising food insecurity fears.
The government plans to keep about 2 million hectares of land until 2020 to ensure a sufficient supply of raw materials to the agriculture processing industry.
Many Lao businesspeople said they supported the Japanese investors' request for a lower land classification fee, arguing that state service fees should be low and explaining that they now have to shoulder higher investment costs as the government has changed many taxes and fees.
They added that the land would be of little value if people weren't willing to conduct business on it, while the government should develop the local processing industry instead of waiting to collect land classification fees, as the latter does not help to create jobs.
Business operators argue that the government stands to benefit more from investors turning small plots of agricultural land into industrial zones, as it will receive both profit and income tax from businesses.
They say the government should provide technical support and market access for Lao farmers, to boost agriculture and prevent arable farmland from disappearing.
Large numbers of Lao people continue to turn agricultural land into commercial land despite continued increases to the land classification fee.
vientiane times
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