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Vientiane sees 27 percent surge in Q1 revenue
Vientiane saw a 27 percent jump in revenue collection over the first quarter of this fiscal year, with most of the income derived from land transaction fees and taxes.
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| Vientiane vendors do a brisk trade as finance officials say business tax is dropping by about 10 percent |
According to a report from the Finance Department, Vientiane authorities collected about 114 billion kip in revenue from October to December 2011, an increase of about 27 percent compared to the same period last year. The revenue collected amounted to about 25 percent of the annual plan.
In the first quarter of the 2011/2012 fiscal year, the revenue earned from land taxes and transaction fees was 37.67 billion kip, an increase of about 130 percent compared to the same period last year. This figure represents 77 percent of the annual plan.
Land officials were able to exceed their revenue expectations after using computer programmes to create a land database. The growing number of land transactions in the capital is also helping to boost revenue collection.
A land transaction service fee ranging from one to three percent is payable depending on the relationship between the seller and purchaser. Parents who transfer land to their children pay a smaller fee than people who transfer land to other parties, as the latter is considered to be a commercial transaction.
The government plans to charge income tax of 10 percent on the sale of land this year after the National Assembly passed a revised Law on Tax.
Revenue from taxes was 70.11 billion kip, about 10 percent less compared to the previous year and amounting to 19 percent of the annual plan. Vientiane authorities did not give any reason for the decline in revenue.
According to a source, the Ministry of Finance has ordered Vientiane authorities to stop using assigned revenue targets as a reference for tax officials to estimate the amount of tax to be paid by vendors, after SMEs complained about unfair tax rates.
The ministry has advised Vientiane tax collectors to charge tax based on vendors' actual income.
The ministry also set up a pilot project in Vientiane under which vendors at the Talatsao Shopping Mall pay their taxes through banks instead of to tax officials. The ministry expects this more streamlined method will enable tax payments to be more efficient.
Revenue obtained from state assets and state enterprises was 6.25 billion kip, about 22 percent less compared to the previous year and only 20 percent of the annual plan.
Revenue from Customs Region 5, which covers Vientiane, Vientiane province and Borikhamxay province, was 427 billion kip, accounting for 21 percent of the annual plan.
This fiscal year, the Ministry of Finance has tasked Vientiane to collect 458 billion kip in revenue. The capital eyes growth of 12 percent this year, with the construction sector seen as the main driving force.
vientiane times
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