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Opposition party calls for land concession tax raise

121205_06

Sam Rainsy Party whip Son Chhay calls for increased taxes on economic land concessions, Tuesday, Dec. 05, 2012. Photograph: Pha Lina/Phnom Penh Post

Opposition party whip Son Chhay reiterated his call at a press conference yesterday for the government to raise taxes on economic land concessions from $5 to $7 a hectare up to $70 through an amendment to the draft of the 2013 budget.

The Sam Rainsy Party (SRP) whip, who will transfer to the united opposition Cambodian National Rescue Party after next year’s election, says the higher tax rate would be reasonable, given the huge profits companies make from their economic land concessions (ELCs).

Chhay said yesterday that if Prime Minister Hun Sen was unwilling to raise the ELC tax, he should at least make sure the concessions did not go to foreign companies so they could pay less tax than rural peasants.

“Give it to Khmer farmers. We pay $10 or $20 so that our farmers can have land to farm,” he said. “So, we demand [the government] tax $70,” he said, adding that for the 2.8 million hectares of ELCs this would generate close to $200 million.

The tax is part of Chhay’s strategy to wean the country off foreign loans through a series of new taxes targeting highly lucrative businesses while boosting government spending and increasing the salaries of civil servants and others.

But his plan is falling on deaf ears at the Cambodian People’s Party headquarters.

In a letter of reply to Chhay’s formal letter to the National Assembly dated November 26, CPP senior legislator Cheam Yeap ruled out any amendments without saying why.

“The last request the Excellency [Son Chhay] asked to reduce borrowing money from foreign countries, the committee has been studied completely but cannot reduce because it is necessary for infrastructure spending for the nation,” Yeap’s reply stated.

Yeap lauded the remarkably progressive public administration in Cambodia that had come about by the methods of collection for the national budget and reform.

Government figures show that civil servants, excluding soldiers, earn an average of $48 a month.

To contact the reporter on this story: Meas Sokchea at sokchea.meas@phnompenhpost.com

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