How is salary tax calculated in the Lao PDR?

Under Lao Tax Law No. 67, salary tax is assessed on a mandatory monthly basis across 6 progressive brackets: 0% (up to 1.3M Kip), 5% (1.3M to 5M), 10% (5M to 15M), 15% (15M to 25M), 20% (25M to 65M), and 25% (over 65M Kip).

What is the employee LSSO social security deduction in Laos?

Employees contribute 5.5% of their monthly wage to the Lao Social Security Organization (LSSO), which is legally capped at a maximum wage ceiling of 4,500,000 LAK per month (equal to a maximum employee deduction of 247,500 LAK).

Are expatriate workers subject to the same progressive salary tax in Laos?

Yes. Foreign residents working in the Lao PDR under a valid work permit and residency visa are subject to the same progressive monthly rates (0% to 25%) on their Lao-sourced employment compensation.

Lao PDR Salary Tax Calculator 2026: LSSO & Net Income

Navigating Lao Payroll and Personal Taxation in 2026

When employed in Vientiane, Luang Prabang, or special economic zones in the Lao PDR, your contractual wage is subject to statutory monthly deductions under Tax Law No. 67 and mandatory contributions to the Lao Social Security Organization (LSSO).

1. Monthly Progressive Salary Tax Brackets

Lao law mandates monthly tax computation:

0 to 1,300,000 LAK: 0%
1,300,001 to 5,000,000 LAK: 5%
5,000,001 to 15,000,000 LAK: 10%
15,000,001 to 25,000,000 LAK: 15%
25,000,001 to 65,000,000 LAK: 20%
Over 65,000,000 LAK: 25%

2. Verified Numerical Scenario: Monthly Wage of 20,000,000 LAK

Consider an employee receiving a monthly gross salary of 20,000,000 LAK:

| Deduction Component | Monthly Amount (LAK) | Statutory Rules Applied | |---|---|---| | Contract Gross Salary | 20,000,000 LAK | Total contractual monthly wage | | LSSO Social Security (5.5%) | -247,500 LAK | 5.5% on capped ceiling of 4.5M LAK | | Taxable Income Base | 19,752,500 LAK | Gross minus allowable LSSO | | • Bracket 1 (Up to 1.3M LAK @ 0%) | 0 LAK | Fully exempt base | | • Bracket 2 (1.3M to 5.0M LAK @ 5%) | -185,000 LAK | 5% on 3,700,000 LAK | | • Bracket 3 (5.0M to 15.0M LAK @ 10%) | -1,000,000 LAK | 10% on 10,000,000 LAK | | • Bracket 4 (15.0M to 19.75M LAK @ 15%) | -712,875 LAK | 15% on remaining 4,752,500 LAK | | Total Monthly Salary Tax | -1,897,875 LAK | Progressive tax withholding | | Total Monthly Deductions | -2,145,375 LAK | LSSO (247.5k) + Tax (1.898M) | | Net Monthly Take-Home Pay | 17,854,625 LAK | Net cash deposited in local account |

Key Takeaway:

On a 20 million Kip monthly salary, the combined tax and social security load is 10.7%, leaving 17,854,625 LAK net for household living expenses.

3. Regulatory Sources & Verification

Tax Legislation: National Assembly of the Lao PDR, Tax Law No. 67/NA & Ministry of Finance Implementation Decree. Verified on 21/09/2026.
Social Security Regulation: Lao Social Security Organization (LSSO) statutory caps. Verified on 21/09/2026.

Simulate your monthly Lao take-home salary:

Lao PDR Monthly Salary Tax 2026: Progressive Brackets, LSSO & Net Income

Table of Contents