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Forestry revenues falling short

A villager stands with her baby in a logged area in Keo Seima district in Mondulkiri province
A villager stands with her baby in a logged area in Keo Seima district in Mondulkiri province. Heng Chivoan

Forestry revenues falling short

Rights groups have called on the government to increase tax rates for logging companies amid the latest domestic revenue figures.

According to the Ministry for Agriculture, Forestry and Fisheries, timber exports produced $9.4 million in government tax revenue during the first half of the year, up 28 per cent from $7.3 million during the same period in 2013.

Hout Punleu, an official from the forestry department, said the income recorded in the government’s books is largely generated from logging companies located within economic land concessions for legally cut rattan palms and the sale of repossessed illegally logged timber.

The Ministry of Agriculture’s 2012 annual report shows 16 companies have valid licences to collect and export timber.

Ouch Leng, director of the Human Rights Task Force, said the government’s tax figures are too low and does not reflect the reality of the logging industry’s revenues.

“Just one company exports at least $15 million worth of timber per day. If I simply calculate that over the space of a year, then the government’s total tax benefit from the industry is so low,” he said.

Leng urged the government to increase private companies’ tax obligation from the current 5 per cent to 30 per cent.

“The income from forestry budget earned in the last few years has not contributed to national development. We are losing money for the national budget and at the same time losing timber in the forest, and people remain poor,” he said.

Logging and deforestation in Cambodia has long been a point of controversy with human rights and environmental abuses and land grabbing regularly featuring in the mainstream media. Satellite maps released by Open Development Cambodia in December show a decrease in total forest coverage from 60.18 per cent to 46.33 per cent from 2009 to 2013. Though this rate is disputed by the government, which includes agricultural crops in its estimate of forestry cover.

Srey Chanthy, an independent economic analyst, said the domestic revenue recorded by the government is low.

“The income from forestry into national budget these years have contributed not so much to national development if we look at the number. It would give better long-term economic benefit to Cambodia if the forest is kept untouched,” he said.

Chanthy add that by diminishing the Kingdom’s forests, the country also becomes more susceptible to the impact of climate change.

“More deforestation results in less rain and shallower water resources, which will make agriculture production cost higher for farmers,” he said.

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