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On 20 November 2013, the State Asset Management Department of the Ministry of Finance officially launched an online system for the registration of moveable property, with a grant from the International Financial Corporation ("IFC"). The online registry was set up to encourage commercial banks and financial institutions to grant loan facilities or provide credit secured by moveable property.
The registry for security interests in moveable property is Lao PDR's first system which enables businesses and individuals to pledge moveable assets such as vehicles, equipment, crops or even future income as collateral for loans, opening up loan opportunities for micro, small and medium enterprises which previously might not have been able to obtain a loan if they do not own real estate which they can pledge as security.
The Lao National Assembly has approved the amendments to the Law on Value-Added Tax ("VAT") at the 6th Ordinary Session which ran from 9 to 27 December 2013, to remove tariffs on materials which Laos cannot produce domestically in preparation for the ASEAN Free Trade Area and ASEAN Economic Community in 2015.
The 10 percent tariff currently applicable to certain materials and machinery that cannot be produced in Laos will be removed entirely. This move is intended to encourage investment in commercial production of goods and materials, both for domestic sale and for export.
VAT is an indirect tax collected on the proportion of value added to goods and services occurring in all processes, from production and distribution to service supply and consumption. It is also collected on the value of goods and services imported into Laos.
Please note that whilst the information in this Update is correct to the best of our knowledge and belief at the time of writing, it is only
intended to provide a general guide to the subject matter and should not be treated as a substitute for specific professional advice.
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