Laos Government Targets Unsettled Crypto Taxes in Push for National Revenue Boost
Summary:
In an effort to increase national income, the Lao government is focusing on the local cryptocurrency sector, from which it is owed $20 million in taxes and license charges. However, several companies have failed to make progress or fulfil their financial commitments. Amidst a 50% decline in cryptocurrency prices, the government plans to halve the payment liabilities of such businesses. Those continuing to lag behind could face penalties or license revocation. Faced with a national crisis due to prolonged drought, the government is leveraging digital tech for various economic benefits, with Blockchain 4.0 playing a key role in financial inclusion, transparency, and security in the country.
With a goal to augment its national income, the Lao government seems to be focusing on the local cryptocurrency business. Xinhua News, China’s national news agency, in a report published on 9th November, sourced from Laos People's Army News, suggests that crypto businesses in the Southeast Asian nation have an unpaid dues of $20 million in taxes and license related charges. In a move to broaden its revenue channels, the Laos government had earlier given a green signal to 15 blockchain-based firms to delve into cryptocurrency mining or function as exchanges.
Nevertheless, Laos' Prime Minister Sonexay Siphandone states that two of these firms made no significant advancement. Others fell short in fulfilling their monetary commitments to the government. Further, he indicated that post the government's fixation of tax obligations, there has been a 50% decline in cryptocurrency prices. As a result, the Lao government has decided to cut down the payment liabilities by half for crypto businesses.
This decision led to these businesses starting to pay their fees, with full settlement expected by year-end, as stated by Sonexay. However, a stern warning was issued by him for firms not keeping pace, stating that they will face a suspension of operations, financial penalties, or revocation of license.
The Laos government battled a crisis this year following a prolonged drought stretching from January to June. Among numerous other repercussions, the calamity led the government-run power distribution corporation, Électricité du Laos, to cease the electricity supply to crypto-mining operations across the country. In May, the Lao government outlined several crucial aspects for its digitization strategy, one of which entails leveraging digital tech to create new tax revenue, reinforce foreign exchange reserves, control inflation, and stimulate sustainable economic growth. Blockchain 4.0 is ushering in a revolution in Laos by fuelling financial inclusion, promoting transparency and bolstering transactional security. The emergence of smart contracts and decentralized finance is paving the way for economic growth. It is indisputably creating a paradigm shift in the country's economy.
Published At
11/9/2023 2:12:20 PM
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