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Logo of Phnom Penh Post newspaper Phnom Penh Post - Tax reform looms large for new government

Tax reform looms large for new government

Cambodia's General Department of Taxation has laid out a series of reforms it says are needed as the 2015 deadline looms for the Asean Economic Community, a single market for trade and development.

Strengthening tax collection to increase revenue while nurturing an attractive investment climate is the balance that must be struck, said the department’s director general Kong Vibol during a European Chamber of Commerce-hosted event at Raffles Hotel le Royal on Tuesday.

“We have to promote a fair playing field for all of you,” he said to an audience of foreign and local business people, attempting to allay concerns of an unfair advantage for those that are compliant compared to businesses that avoid paying tax.

From tax education for small and medium-sized enterprises to reviews of investor taxation laws and better legal means for pursuing tax dodgers, the government has a broad range of policy implications that it hopes to achieve in a very short time frame.

“I have a lot of issues to resolve,” said Vibol, who has established 78 working groups inside the department.

While calling the goals “ambitious”, Clint O’Connell, a tax partner with firm VDB Loi, welcomes the department’s goals to create a more lucid tax code.

“By clarifying the laws, the tax department is encouraging taxpayer compliance and indeed making it easier,” he said.

The five-year tax strategy will be submitted for approval to the cabinet once the next government has been formed.

Opposition Cambodia National Rescue Party whip Son Chhay said the government has been making promises to tighten tax collection for a long time but “they never deliver”.

“You can talk about that for a hundred more years, but unless you have a check and balance system then these bad people will not be punished,” he said.



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