Investment Incentives in Laos
Laos offers a structured incentive framework for qualifying investments — but eligibility and specific benefits depend on your activity, location and classification, not a single universal package.
QUICK ANSWER
Laos provides investment incentives under the Law on Investment Promotion (Amended), No. 62/NA, combining sector-based and zone-based categories with profit tax exemptions, customs duty and VAT-related exemptions, land lease/concession fee exemptions, and additional facilitation measures. These are not automatic or universal: eligibility depends on your specific business activity, its zone classification, and — for some incentives — a formal application and approval. Special and Specific Economic Zones receive additional incentives layered on top of the general framework. This page explains the structure; your specific eligibility should be confirmed with the relevant authority or with AQQOUNT.
At a Glance
WHO MAY QUALIFY
Investors in sectoral-based promoted activities, zonal-based investments, and Special/Specific Economic Zone investments
MAIN LEGAL FRAMEWORK
Law on Investment Promotion (Amended), No. 62/NA (in force 1 October 2024)
TYPES OF INCENTIVES
Profit tax exemptions, customs duty/VAT-related exemptions, land lease/concession fee exemptions, other facilitation measures
WHAT DETERMINES ELIGIBILITY
Business activity/sector, zone classification (Zone 1 or Zone 2), and whether the investment is in a Special/Specific Economic Zone
RELEVANT AUTHORITY
Investment Promotion and Management Committee (IPMC), via the One-Stop Investment Service
WHAT TO VERIFY
Your specific activity’s sectoral category, its zone classification, and any additional regulation detailing your incentive
Official Information
OFFICIAL INFORMATION
The current governing framework is the Law on Investment Promotion (Amended), No. 62/NA, in force since 1 October 2024 — not the earlier 2009 or 2016 investment promotion laws, which have been superseded. Some older secondary and even official-adjacent materials still reference article numbers from the 2009 law; where we encountered this, we relied on the current 2024 law’s own numbering instead, and flag the discrepancy in our research notes.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 101 (entry into force and supersession)
OFFICIAL INFORMATION
Investment incentives are defined as customs duty, tax, State land lease or concession incentives, and other sectoral or zonal-based incentives. Eligible investments include general businesses (both on and off the Controlled Business List), concession businesses, and Special/Specific Economic Zone investments.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 8
Types of Incentives
Sectoral-Based Incentives
OFFICIAL INFORMATION
Nine sectoral categories are eligible for incentives: (1) clean agriculture, seed and animal breed production, forestry and biodiversity protection; (2) environmentally friendly processing, fertilizer production, and “One District, One Product” or import-substitute/export goods; (3) hospitals, pharmaceutical/medical device manufacturing, traditional medicine; (4) education, sports and skill development; (5) digital technology adoption and R&D; (6) sustainable tourism; (7) public infrastructure (roads, railways, water, waste management); (8) SEZ/SpEZ infrastructure development; (9) logistics, freight and cross-border transport. The Government is to introduce a separate regulation detailing a more granular eligible-investments list — we have not located this separate regulation.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 9
Who may qualify: investors whose specific business activity falls within one of these nine categories. What determines eligibility: the precise nature of the activity — not every business “related to” these sectors automatically qualifies. Relevant authority/process: application for an Investment Promotion Certificate through the One-Stop Investment Service Office. Important limitation: the more detailed implementing regulation for this list was not located in our research.
Zonal-Based Incentives
OFFICIAL INFORMATION
Investments are also classified by zone: Zone 1 (areas where socio-economic infrastructure does not yet facilitate investment) and Zone 2 (areas where infrastructure does facilitate investment). The Government reassesses this zone classification every five years.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 10
Who may qualify: any investor whose project sits in a defined Zone 1 or Zone 2 area. What determines eligibility: the physical location of the investment. Important limitation: we have not located a current, published map identifying which specific provinces or districts are classified as Zone 1 versus Zone 2 — this should be confirmed for your specific project location.
Profit Tax Exemptions
OFFICIAL INFORMATION
An investor undertaking a qualifying sectoral and zonal-based investment is eligible for a profit tax exemption of up to 10 years (Zone 1) or up to 4 years (Zone 2), with an additional 5 years (Zone 1) or 3 years (Zone 2) for specific sectors (clean agriculture, eco-friendly processing, and healthcare/pharmaceutical categories). Investment in the education sector receives a profit tax exemption for the entire investment period. The exemption period begins the year the enterprise generates revenue; after it expires, the standard Law on Income Tax applies.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 11
We are deliberately not compressing this into a single number, because the actual exemption period depends on which zone and which sector category applies to your specific investment.
Customs Duty, Income Tax and VAT Incentives
OFFICIAL INFORMATION
Qualifying investors receive customs duty exemptions on imported materials, machinery and vehicles not available domestically and used directly in manufacturing; on raw materials and equipment used for export manufacturing; and on raw materials used for import-substitute manufacturing. Exported agricultural, industrial and handicraft products receive a customs export duty exemption (subject to periodic exceptions for specific goods). Specialists working in promoted sectors receive a flat 5% personal income tax rate, with eligibility defined in a separate regulation we have not located. VAT incentives follow the separate Law on Value-Added Tax, which we have not independently reviewed.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 12
Land-Related Incentives
OFFICIAL INFORMATION
Sectoral-based investments are eligible for state land lease or concession fee exemptions of up to 10 years (Zone 1) or up to 5 years (Zone 2), with an additional 5 years (Zone 1) or 3 years (Zone 2) for the same specific sector categories noted above. Concession-business investors also receive specific state land use incentives, including the right to request land use rights for the remaining lease/concession tenure after implementing more than 50% of the approved project.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Articles 15–16
Other Facilitation Measures
OFFICIAL INFORMATION
Additional supporting incentives include access-to-finance facilitation, a one-year profit tax exemption on reinvested profits used to expand a business, State recognition/awards for strong compliance, and special consideration for foreign investors (and their families and specialists) to obtain residence permits and multiple-entry business visas — generally up to 5 years per grant.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Articles 13, 14, 19
Additional Incentives for Special and Specific Economic Zones
OFFICIAL INFORMATION
SEZ/SpEZ investment receives incentives layered on top of the general framework: developers receive a total profit tax exemption of 16 years (Zone 1) or 8 years (Zone 2); other SEZ/SpEZ investors generally receive an additional 2 years of profit tax exemption beyond the standard sectoral/zonal incentive (except for the logistics sector); land lease fee incentives apply per the zone’s specific agreement; and multi-entry visas of up to 10 years are available to foreign developers/investors and their families — with a specific 10-year visa available to individual foreigners who purchase at least USD 100,000 of real estate within a SEZ/SpEZ.
Official source: Law on Investment Promotion (Amended), No. 62/NA, Article 64
This means there is no single “SEZ incentive package” that applies uniformly — SEZ incentives are additive on top of whatever sectoral/zonal incentive already applies to your activity. See our dedicated Special Economic Zones in Laos guide for the zones themselves. Incentives are also closely tied to activity classification under our Investment Sectors in Laos guide.
Who Qualifies?
AQQOUNT PRACTICAL GUIDANCE
There is no single eligibility checklist that applies to every investor. Whether you qualify for an incentive — and which one — depends on the interaction of several factors: your specific business activity (does it fall in one of the nine promoted sectoral categories?), your project’s location (Zone 1 or Zone 2?), your investment category (General Business, Controlled Business, Concession, or SEZ/SpEZ?), and whether you complete the formal application process. Two investors in superficially similar businesses can have materially different incentive eligibility if one sits in a promoted sector or zone and the other does not.
Practical Investor Checklist
Before assuming an incentive applies to your project:
01Identify the investment activity
Be specific — the exact activity determines sectoral eligibility.
02Determine the investment type
General Business, Controlled Business, Concession, or SEZ/SpEZ — each has different incentive treatment.
03Check whether the activity and location qualify
Confirm sectoral category and Zone 1/Zone 2 classification for your specific site.
04Identify the applicable legal basis
Cite the specific article or regulation your incentive relies on — not a general assumption.
05Confirm the responsible authority
Typically the One-Stop Investment Service Office, but this can vary by investment type.
06Confirm required documentation
Documentation requirements for an Investment Promotion Certificate application.
07Confirm the incentive in writing
Where appropriate, obtain written confirmation from the relevant authority before committing capital.
Common Mistakes
01Assuming all foreign investments receive the same incentives
Incentives depend on activity, zone and investment type — not on being a foreign investor per se.
02Relying on old incentive tables
The current law (No. 62/NA, 2024) replaced the 2016 law and its 2019 amendment — older figures may no longer apply.
03Confusing investment incentives with ordinary tax treatment
Incentives are exemptions from otherwise-applicable tax; once an exemption period ends, standard tax law applies.
04Assuming an incentive applies without confirming eligibility
Eligibility is not automatic — it typically requires an application and, for some incentives, approval.
05Relying on promotional material without checking the legal basis
Always trace a claimed incentive back to its specific article or regulation.
Frequently Asked Questions
What investment incentives are available in Laos?
Profit tax exemptions, customs duty and VAT-related exemptions, land lease/concession fee exemptions, a flat 5% personal income tax rate for qualifying specialists, and additional facilitation measures — with further incentives for Special/Specific Economic Zone investment. The specific combination depends on your activity, zone, and investment type.
Does every foreign investor qualify for incentives?
No. Eligibility depends on your specific business activity, its zone classification, and investment type — not on foreign investor status alone.
Are incentives different by sector?
Yes. The law defines nine sectoral categories eligible for incentives, with some (clean agriculture, eco-friendly processing, healthcare, and education) receiving extended or full-period exemptions.
Are incentives different by location?
Yes. Investments are classified into Zone 1 (less-developed infrastructure) or Zone 2 (more-developed infrastructure), which affects the length of tax and land-fee exemptions.
Where can investors confirm their eligibility?
Through the One-Stop Investment Service Office (part of the Investment Promotion and Management Committee), or via AQQOUNT, who can make this inquiry on your behalf.
Do SEZ investments have separate incentive arrangements?
Yes. Special and Specific Economic Zone investments receive additional incentives layered on top of the general sectoral/zonal framework, including extended profit tax exemptions and longer multi-entry visas.
How long does a profit tax exemption last?
Up to 10 years (Zone 1) or 4 years (Zone 2) at the base level, with additional years for specific sectors, education receiving the full investment period, and SEZ/SpEZ investors receiving further additions. There is no single flat figure that applies to every investor.
Related Guides
04Profit Repatriation in Laos
How sector- and zone-based incentives interact with the process of repatriating profits.
Not Sure Which Incentives Apply to Your Project?
Tell us about your investment and we’ll help confirm your eligibility before you commit capital.
Last reviewed: September 2026
Official sources:
- Law on Investment Promotion (Amended), No. 62/NA (2024), Articles 8–20, 64 — full text reviewed
- InvestLaos — Investment Types