The finance and tourism ministries on February 9 issued a proclamation authorising the implementation of key policies for tourism in 2022, primarily the extension of tax exemptions through to June 30 for hotels, guesthouses, restaurants and travel agencies registered with the General Department of Taxation (GDT).

The tax exemptions apply only for businesses operating in the capital, Banteay Meanchey province’s Poipet town and Svay Rieng province’s Bavet town, as well as the coastal provinces of Preah Sihanouk, Kep and Kampot, according to the inter-ministerial decision signed by the finance and tourism ministers.

Additionally, audits will be postponed for 2021, for tourism operators with pre-Covid outstanding debt based in other localities, it said, noting that these businesses are still required to file tax declarations and use the electronic value-added tax (E-VAT) management system each month during the exemption period.

Pacific Asia Travel Association (PATA) Cambodia chapter chairman Thourn Sinan told The Post on February 10 that the government not only exempts taxes on tourism licences, but also patent taxes. However, it should not penalise companies that have not yet resumed, he opined.

He proposed that the government adopt a more lenient bankruptcy policy in terms of taxes and tax inspections, arguing that thousands of tourism-oriented companies remain dormant and cannot be dissolved from the state registry under the current regime without incurring huge sums of tax obligations.

“The government should introduce a moratorium on inspections and allow companies to close for a few months without the need for an audit,” he said.

Cambodia Hotel Association president Din Somethearith told The Post on February 10 that the continued tax exemption for tourism-related businesses was “very good”, in view of the struggles faced by businesspeople in the sector.

“I would like to thank the government for taking this into account,” he said.

The inter-ministerial decision affirmed that patent taxes on travel agencies and other tourism operators would continue to be exempted in 2022, but noted that taxpayers are obliged to update patents.

While exemptions of renewal fees for all categories of tourism licences will be in effect in 2022, businesses are still required to apply for renewal at the tourism ministry or corresponding municipal, provincial, town or district administrative office, as previously determined by the ministry based on the type and size of the business, it said.

Of note, one of the purported goals of the decision was identified as: to buoy sales of tickets to Angkor Archaeological Park till December 31.