Cambodia's property-tax collection efforts may not initially raise large amounts of revenue, but are crucial to setting a precedent for future revenue- generation efforts, Economy and Finance Minister Keat Chhon says.
“We don’t expect much tax income from this new law, but we cannot help but make the law because we want to establish a tax culture that allows us to collect more tax directly in the future,” he said yesterday.
Generating tax revenues was an important step towards funding national development, Keat Chhon said on the sidelines of a seminar on the property tax.
It will initially be collected in eight districts within Phnom Penh and 26 towns and cities in 23 provinces, beginning in September, but will not apply to agricultural land or properties valued at less than 100 million riel or US$25,000.
The tax will be assessed on 0.1 per cent of property values based on market prices, as evaluated by a committee.
Keat Chhon declined to detail the expected income from the levy.
Realtors said they welcomed the government’s efforts to collect tax, provided it was done transparently.
Cambodia Property Limited managing director Cheng Kheng said yesterday he supported the tax, provided it was applied fairly to all property owners and housing developers.
“It’s time to begin collecting tax on property, but we want the government to be transparent with us,” Cheng Kheng said.