The government is mulling over imposing a digital service tax on international tech companies, the Ministry of Posts and Telecommunications said in a press release on Wednesday.
This aims to collect tax on such services provided by firms that generate revenue from Cambodians but are not registered in the Kingdom, the ministry said, listing Netflix, Amazon, Alibaba, Facebook and Google as examples.
The issue was raised at a meeting held that day between minister Chea Vandeth and Kong Vibol, the director-general of the Ministry of Economy and Finance’s General Department of Taxation (GDT).
Vandeth said his ministry will continue to work with the GDT and the finance ministry to “ensure prompt tax obligations by digital services providers and telecoms operators”.
He said: “In this era, as Cambodia and other countries continue to adopt digital technologies to improve work efficiency, the importance of critical information infrastructure [CII] protection as a means to safeguard internet traffic and provide additional cybersecurity for the GDT’s existing IT [information technology] infrastructure.”
Vibol voiced his support for the telecoms ministry’s plan to develop a “Big Data hub” to share and integrate information among government institutions at the national and sub-national levels.
He said the telecoms ministry and the GDT plan to “implement bilateral information exchange, share telecoms operators’ revenue data from the Data Management Centre [DMC], provide technical support in enforcing tax obligations using the upcoming National Internet Gateway [NIG].
“[They] will jointly draft regulations and build technical capability to tax digital advertisements and services,” Vibol said.
In mid-October, the Ministry of Commerce called on e-business owners to apply for permits and licences to operate legally in Cambodia.
Cambodia’s e-commerce law came into force in November last year and aims to regulate electronic businesses based in the Kingdom and enable local small and medium-sized enterprises to integrate into value chains linked to domestic and international markets, the ministry said in a prakas.
E-commerce permits and licences are valid for two and three years, respectively, from the date of issuance, the prakas said.
Registered mobile SIM cards provided by the Kingdom’s six mobile operators – CellCard, Metfone, Smart Axiata, qb, Seatel and CooTel – reached 21.63 million last year, up 11.63 per cent compared to 2018.
Internet usage increased 18.47 per cent and fixed broadband internet subscribers grew to 224,104, a 46 per cent rise.
The number of registered Facebook accounts also increased by 29 per cent to 8.8 million last year.