Luang Prabang lures foreign investors with tax incentives
To attract foreign investors, Luang Prabang province offers waiver of corporate income tax (CIT) for up to six years. Investors will be offered CIT exemption depending on part of the zones they invest in. Luang Prabang city, the world heritage town, would give a CIT waiver for the first 2 years of operations. For other districts, four to six years of CIT exemption will be given. However, for businesses related to food, hotels and tourism services, full foreign ownership is not permitted and joint venture with local partner is necessary. Foreigners are allowed to have full ownership in other sectors such as souvenir, packaging and agriculture to supply to tourism sector.
Implication: By allowing low cost carrier’s (AirAsia Thai) operation earlier this year and tax incentives, Luang Prabang begins to open up and develop its tourism sector.