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SMEs set to boost the Kingdom’s economy

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One hundred five SMEs were registered during the first three quarters of this year. lyly

SMEs set to boost the Kingdom’s economy

More than 100 local small and medium enterprises (SMEs) were registered during the first three quarters of this year, and officials expect the government’s tax incentive policy for SMEs to boost growth, said a Ministry of Industry and Handicraft report.

The SMEs – 105 of them – were registered in the first nine months, bringing the total to 155,745 and creating more than one million jobs, said the report.

The ministry’s director-general of the SME department Laim Kim Leng said the increase in registered SMEs was due to the government’s policy to decentralise SME registrations.

“We expect that the number will keep growing next year since we have tax exemptions as well as a decentralised registration policy,” said Kim Leng, who continued that SME registration will profit the owner with tax exemptions, technical training and financial access.

However, the report shows that about 20 per cent are informal SMEs or those that are unregistered.

The sub-decree on SME tax incentives, signed by Prime Minister Hun Sen on October 2, identifies priority sectors – agro-industry and food production and processing.

They will receive an income tax exemption for three to five years from the date of tax registration for new enterprises, or from the date of tax registration update for enterprises that have been registered.

The Federation of Associations for Small and Medium Enterprises in Cambodia president, Te Taingpor, said SME tax exemptions are important and will push all SMEs to register.

However, he urged the government to consider providing tax incentives to other SMEs in order to support agro-products as Cambodia has a lot of raw materials.

“There are still a lot of SMEs that haven’t registered because challenges still remain for them to see a profit,” Taingpor said, adding that it would be great for the sector if the government provided even more incentives for SMEs.

“I believe many SMEs will register and this will provide a great benefit for the government in the future."

“SMEs play an important role in promoting economic growth. If we have a proper SME development policy, we will profit together,” he said.