Cambodia and the Republic of Korea have reached an agreement to avoid double taxation on income and prevent tax evasion, while industry insiders said the agreement will attract more Korean investors to Cambodia.
A press release from the General Department of Taxation issued on Tuesday said the agreement was signed on Monday by Cambodian Minister of Foreign Affairs and International Cooperation Prak Sokhonn and Korean Minister of Foreign Affairs Kang Kyung-wha during the Korea-Asean Summit in Busan, South Korea.
Ministry of Commerce spokesman Penn Sovicheat said the agreement was reached to encourage Korean investors.
Cambodia Chamber of Commerce vice-president Lim Heng said the agreement would give more confidence to foreign investors as well as those from Korea. “If we have a clear agreement with each other, it will help attract more Korean investors,” he said.
Heng said Cambodia had, to date, signed similar agreements with nearly 10 countries which include the US, Canada, China, Japan, Singapore and Vietnam.
With the agreement, he said investors in Cambodia are required to pay only 14 per cent in tax. “Without the agreement, they would have to pay taxes in our country and also in Korea,” he said.
Also, Cambodia and Korea on Monday signed a joint feasibility study on the establishment of a free trade agreement (FTA) aimed at expanding bilateral trade volume and investment and tightening bilateral ties.
The government collected $2.4 billion in revenue from taxation during the first 10 months of this year – up 28.31 per cent year-on-year from $1.873 billion – a report from the General Department of Taxation (GDT) said on Monday.
Revenue in the 10-month period is equivalent to 105.06 per cent of the General Department of Taxation’s 2019 revenue collection plan. In 2018, the GDT collected about $2.2 billion in various taxes. This is equivalent to some 114 per cent of the annual plan.