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

  • Purging Sihanoukville’s past with a new masterplan

    Amid illicit activities, haphazard development and abandoned projects, the coastal city of Sihanouk province needs a reset to move forward. A new masterplan might be the answer to shake off its seemingly mucky image to become the Shenzhen of the south Gun toting, shootouts, police

  • Chinese may be first in tourism revival: PM

    Cambodia's tourism industry is gearing up to roll out the red carpet for Chinese travellers after Prime Minister Hun Sen on September 17 indicated that the Kingdom could soon throw open its doors to international holidaymakers vaccinated against Covid-19 – starting with guests from China. Cambodia Chinese

  • 'Pursue your goals, reach out to me': Young diplomat tapped as envoy to South Korea

    Chring Botum Rangsay was a secretary of state at the Ministry of Foreign Affairs and International Cooperation before being designated as the new Cambodian ambassador to South Korea. According to her official CV published on the foreign ministry’s website, she started her first government

  • Tourism concerns laid bare

    To ensure the success of plans to reopen the tourism market for international visitors, Cambodia must pay utmost attention to two primary determinants – the ongoing paradigm shift in domestic tourism services towards the ‘new normal’, and the factors influencing choices of destinations among foreign holidaymakers.

  • Covid jab drive for 6-11 age group to begin Sept 17

    Prime Minister Hun Sen has permitted Covid-19 vaccinations for over 1.8 million children aged 6-11 across the country from September 17 in order for them to return to school after a long hiatus. Hun Sen also hinted that vaccinations for the 3-6 age group will follow in

  • No ‘Crown Prince’ exists to buy France football club: ministry

    The Ministry of the Royal Palace has denied media reports that a Cambodian “Crown Prince” had purchased the AS Saint Etienne football club of France’s top-flight LIGUE 1 at the cost of €100 million ($117 million). In a press statement on September 19, the ministry stressed that Cambodia