The value of silt soil as the growing medium and source of soil nutrient for the floating garden agriculture is an off-site benefit of soil erosion and sedimentation. This benefit amounted to 452,944,754 kyats (US$ 452,944.75) per hectare of the floating garden in the eastern side of the Inle LAke during one cropping season. The results of the study showed that the costs of soil erosion are very significant in the eastern side of the Inle Lake. The off-site benefits of sedimentation cannot offset the social cost. Soil erosion and sedimentation in the eastern side of the Inle Lake have a negative net social impact amounting to 57,457,929 kyats (US$ 57,457.93) per year. Thus, it is recommended that the government should exert more effort at minimizing soil erosion and sedimentation in the area.