MONGABAY.COM
Mongabay.com seeks to raise interest in and appreciation of wild lands and wildlife, while examining the impact of emerging trends in climate, technology, economics, and finance on conservation and development (more)
WEEKLY NEWSLETTER
|
|
Laos
Index
From the outset of the founding of the LPDR in 1975,
development expenditures depended primarily on foreign
aid,
continuing a pattern begun in the 1950s. In July 1990,
more than
half of the state's total revenue came from foreign aid
and loans.
Until 1988 the bulk of current government revenue--
excluding
capital receipts--came from nontax sources, mainly from
surpluses
of state-owned enterprises. Revenue increased nearly four
times
between 1984 and 1986, and again by over than one-half
between 1986
and 1988, due almost entirely to nontax sources. Tax
collection is
difficult because of the widely dispersed population and
poor
organization and management of the collection process.
An annual rice tax was assessed on all paddy land. The
tax
collected was in principle divided between provincial and
national
budgets, but in practice much was retained in the district
of
collection for in-kind salary support of local officials
and
military personnel. Where villages had schools, a portion
of the
tax collected was delivered to the local teachers(s). The
paddy tax
rate varied between sixty and 120 kilograms per hectare,
depending
on the quality of the land and was reduced to forty to 100
kilograms per hectare in the early 1990s. The paddy tax
rate
amounted to roughly 5 percent of the seasonal yield but
could be
forgiven in the event of a crop failure. A separate, lower
tax, was
assessed on swidden rice fields. Collection from more
remote
villages without road access was always problematic.
Between 1983
and 1986, an improved system of business taxation was
implemented;
despite this, by 1987 the share of nontax sources had
reached over
90 percent of current revenue, from about 70 percent in
the early
1980s.
Substantial qualitative changes in fiscal management
beginning
in 1988 were introduced at most levels of government, and
the
implementation of limited tax reforms changed the fiscal
situation
dramatically with 75 percent of state revenue coming from
taxes.
Nontax revenues declined by 62 percent, however, as the
traditional
revenue source--profits from the state-owned
enterprises--continued
to decrease; thus, current revenue only increased by 42
percent. To
increase revenue, Decree 47--on the national tax and
customs
system--was promulgated in June 1989; the decree broadened
the tax
base by expanding coverage of personal income and
corporate taxes
and improving collection and revenue administration
methods.
Import, profit, and turnover taxes were also increased.
Fiscal
revenue responded positively to the new tax reforms,
increasing
substantially from 1989, to about 11 percent of GDP in
1990;
revenue from taxes alone increased by 62 percent.
Transfers from
public enterprises rose by 63 percent in 1990 over 1989
figures,
and other nontax revenue increased as well, including
lease
payments to the government and overflight charges. The
composition
of revenue remained about 75 percent tax-based through the
early
1990s.
Government revenue actually dropped from 11 percent of
GNP in
1986 to 9.6 percent in 1990. However, its annual growth
rate
increased dramatically, from 9 percent in 1987 to 63
percent in
1990--partially a rebound from the drop in revenue in
1989. GNP
also is subject to dramatic fluctuations, falling from
almost
US$2.4 billion in 1985 to about US$600 million in 1988. By
1991 GNP
had increased to approximately US$1 billion, from
approximately
US$863 million the previous year.
Data as of July 1994
|
|