Logo of Phnom Penh Post newspaper Phnom Penh Post - Tax revenues exceed target pace

Tax revenues exceed target pace

Content image - Phnom Penh Post
The General Department of Taxation collected $217.2 million in January, 9.68 per cent of the annual target. Hong Menea

Tax revenues exceed target pace

The Ministry of Economy and Finance’s General Department of Taxation (GDT) collected 879.68 billion riel ($217.2 million) in tax revenue last month, down 77.08 billion riel or 8.06 per cent compared to 2020, it said in a February 15 press release.

This comes even as tax collection from the three main sources of revenue – “income”, “payroll” and “special” – enjoyed year-on-year gains, with economists quick to peg the decline on government policies granting preferential treatment for sectors that face severe ongoing distress from the Covid-19 crisis.

Still, last month’s figure accounts for 9.68 per cent of the 9.08442 trillion riel annual target – well over one-twelfth, GDT said.

Broken down by category, income tax made up the largest share of revenue last month, raking in 173.79 billion riel (up 7.26 per cent year-on-year), followed by payroll tax (91.31 billion riel, up 10.07 per cent) and special tax (77.10 billion riel, up 5.53 per cent).

GDT director-general Kong Vibol told online media outlet Fresh News that January’s tax revenue numbers had not decreased month-on-month and that this year’s collection level is poised to be slightly higher than in 2020.

“The decline in tax revenue over the first month was due to the [new] Covid-19 cases as well as the overall economic situation,” he said.

Hong Vanak, director of International Economics at the Royal Academy of Cambodia, told The Post on February 16 that the government’s preferential schemes for the Kingdom’s more embattled sectors were the root causes of last month’s underwhelming tax-collection performance.

He dismissed concerns that tax collection would impose a significant burden on government revenue, contending that the state is fully aware of the economic situation and the circumstances surrounding it.

“This dip in revenue is related to the government’s tax-easing policies. I do not think this is a concern,” he said, writing off opinions that suspensions and closures of businesses had played a larger role.

He instead called for greater attention to the three main sources of tax revenue, which he stressed are benchmarks for domestic consumer demand and employment rate.

“In view of the current situation and the introduction of the government policies, I don’t think this year’s revenue collection will be all that different from 2020.

“However, if the government can effectively control the collection of taxes in some key sectors, [such as construction and real estate], revenue collection in 2021 may increase slightly compared to last year,” Vanak said.

GDT collected 11.70052 trillion riel in tax revenue last year, up 423.20 billion riel or 3.73 per cent compared to 2019, it said in a press release issued on January 11, 2020.

MOST VIEWED

  • Massive stingrays may live in Mekong’s deep pools

    US scientists have suggested that unexplored deep pools in the Mekong River in an area of Stung Treng could potentially be home to significant populations of giant freshwater stingrays, one of the world’s largest freshwater fish species. This comes as a fisherman hooked a 180

  • CCC team off on US business trip

    The Kingdom’s leading economists and private sector representatives have called on the US to renew its tax preferential status for Cambodian exports, as a Cambodia Chamber of Commerce (CCC) delegation departed for a weeklong business visit to the US, where they will meet with

  • PM takes time to meet, greet Cambodians living in the US

    After landing in the US ahead of the ASEAN-US Special Summit, Prime Minister Hun Sen was received by over 1,000 Cambodian-Americans including political analysts who welcomed him with greetings, fist bumps and selfies. Hun Sen also met with analyst Mak Hoeun, who had allegedly spoken ill

  • Khmer cinema classics back on big screen for free at WB Arena’s outdoor movies series

    On a recent Saturday evening at WB Arena, Bunsong was enjoying a tasty BBQ meal with his family after work on the long tables that had been arranged out in front of the restaurant as they watched a Khmer action movie on a big outdoor

  • PM heads to Washington for ASEAN-US special summit

    Regional and international issues and how to bring the ASEAN-US partnership to another level will be discussed at length as Prime Minister Hun Sen and his ministers arrive in Washington, DC, for a special summit on May 12-13. During the trip, Hun Sen and ASEAN

  • National Assembly refutes EU resolution

    The National Assembly (NA) has hit back at a European Parliament resolution condemning the political and human rights situation in Cambodia, calling it another display of the Parliament’s “double standards”. Key points of the resolution include a warning that the Parliament could exclude the