Lao and Japanese tax officials attend a seminar on international taxation agreements.

Japan provides lessons on double taxation agreements

Online and offline seminars on the basics of double taxation agreements and ways to prevent income tax evasion are being organised by the Department of Tax, Ministry of Finance, supported by the Japanese International Cooperation Agency (JICA), from September 4-12.
The seminars will inform tax officials about these agreements, as a means of fostering foreign investment.
Double taxation agreements and the prevention of income tax evasion are defined in the international tax cooperation framework. The purpose of such agreements is to formulate a reference for partner countries in the implementation of tax obligations so that taxpayers do not avoid tax obligations and do not have repeated payments, Deputy Director General of the Tax Department, Mr Thammaloth Rasphone, said when speaking at the first seminar on Monday.
The system also encourages investment by investors and migrant workers who come to work or earn income in Laos, as well as information exchange between the agreement partner states.
At the same time, this arrangement fosters good relations in foreign affairs between Laos and other countries.
Laos has signed double taxation agreements with Belarus, Brunei, China, Indonesia, the Republic of Korea, Kuwait, Luxemburg, Malaysia, Myanmar, Russia, Singapore, Thailand and Vietnam.
Cambodia, Japan, the Philippines, Turkiye, Qatar, Iran, India, Portugal, Lebanon and Argentina are preparing negotiations.   
Some countries have expressed a desire to improve some aspects of double taxation agreements, such as the Republic of Korea, Mr Thammaloth said. Negotiating double taxation agreements is important and the officials involved need to be proficient in this field as well as preparing for negotiations with countries that are interested in negotiating with Laos, he added.
The seminars will teach participants about the basics of double taxation agreements and aim to increase understanding of the purpose and goals of the system.
They will learn the difference between draft agreements in the form of UN and OECD to adapt to the situation and context of Laos as well as about ways to conduct negotiations.
The seminars will be led by Japanese specialists in the field, who will explain the importance of double taxation agreements and why they are essential system for promoting foreign investment.
JICA expert Ms Miho Ikeda said Laos has double taxation agreements with more than 10 countries but the most recent agreement was signed in 2014.
Thailand has entered into such agreements with 61 countries and Vietnam with more than 80 countries, so Laos is lagging behind in terms of these agreements, Ms Ikeda said.
The main reason for this is a lack of individuals having sufficient knowledge of how to conduct negotiations, she added.
The recent Asean tax meeting on improving the network of bilateral tax agreements among Asean member countries is part of efforts to ensure that more agreements are signed.
“This first seminar is attended by many people who will be involved in the coming negotiations with Cambodia, and I believe other people including online participants have the potential to become future negotiators,” Ms Ikeda said.

By Times Reporters
(Latest Update September 5, 2023)