Logo of Phnom Penh Post newspaper Phnom Penh Post - Tax-free brackets adjusted

Tax-free brackets adjusted

Content image - Phnom Penh Post
The government has decided that civil servants with low salaries do not have to pay income tax. Photo supplied

Tax-free brackets adjusted

The government has raised the tax-free bracket from 1.2 million riel (about $300) to 1.3 million (about $320) in a move to ensure civil servants due for raises this year are not subjected to income tax.

A sub-decree signed by Prime Minister Hun Sen earlier this month said all employees would have no obligation to pay tax if their salaries are below $320.

Last year, only those making under $300 were exempt from income tax.

The sub-decree also laid out all other tax brackets as follows – those earning $320 to $500 would be taxed at a rate of five per cent, $500-$2,000 (10 per cent), $2,000-$3,000 (15 per cent), and $3,000 and above at 20 per cent.

Ministry of Economy and Finance spokesman Meas Soksensan told The Post on Tuesday that the tax rate was revised by the government and the ministry in order to improve the living standards of citizens and civil servants.

He said many civil servants are due for small bumps in their salaries this year and it would not be fair to expose them to income tax.

The move, he said, was also agreed upon because the government surpassed its expectations in tax collection last year.

The government, therefore, decided civil servants with low salaries should not be subject to income tax, he said.

“This tax rate revision helps civil servants very much. If the government had raised their salaries and not revised the tax bracket, well then the raises would have been meaningless.

“For this reason, we revised the taxable stages by raising it a little to exempt civil servants from taxation,” he said.

Ministry of Civil Service spokesman Youk Bunna told The Post that all civil servants would receive pay raises this year.

He said that teachers will also see their salaries raised and will be able to keep the money now that the tax brackets have been adjusted.

“Overall, when the taxable rate is increased, the benefits will go to our officials. The education sector comprises of primary school teachers and lower-level teachers who earn salaries below the minimum,” he said.

Affiliated Network for Social Accountability executive director San Chey said many citizens will be exempt from tax because it is not only civil servants making meagre incomes.

“When we check the salaries that are subject to tax, it shows that many citizens are already below the taxable bracket. The new tax brackets are not likely to excite citizens,” he said.

Watch video:

MOST VIEWED

  • Omicron patients can stay home: PM

    The Ministry of Health has issued a directive on the treatment of people who have tested positive for the highly transmissible Omicron coronavirus variant, following a suggestion from Prime Minister Hun Sen on the night of January 21. The directive permits home quarantine for those who

  • Cambodia’s first ever anime festival kicks off Jan 22 at capital’s F3 centre

    Phnom Penh's first ever Anime Festival will bring together fans, artists, shops and other local businesses with ties to the Japanese animation style for cosplay competitions, online games, pop-up shops and more on January 22, with Friends Futures Factory (F3) hosting. F3 is a project that

  • Mr Pancake or M Crepe? Tasty by any title

    Crowds of people gather around a lone man with a mobile food cart every day at around 2pm in front of the Institut Francais du Cambodge to order what many say are the best crepes in Phnom Penh. To some – even to the man making

  • Fourth dose Covid booster drive jabs 43K in two days

    In the first two days of the fourth-dose Covid-19 vaccination campaign, more than 43,000 people volunteered to get the jabs, while over 4.6 million people have received a third shot. Health ministry spokeswoman Or Vandine said that fourth-dose vaccinations, which began on January 14 exclusively with the Pfizer

  • Singapore backs Cambodia's efforts on Myanmar

    Singaporean Prime Minister Lee Hsien Loong supports Cambodia in its efforts to seek a solution to the ongoing Myanmar crisis as the chair of ASEAN. Lee expressed his support during a meeting with Prime Minister Hun Sen via videoconference on January 14, with the talks focused

  • PM sets tourism reopening as centrepiece of ATF 2022

    Prime Minister Hun Sen urged ASEAN to reopen tourism and trade now that many of the bloc’s member countries have vaccinated their populations. Speaking at the 40th ASEAN Tourism Forum 2022 (ATF 2022) in Preah Sihanouk province on January 18, the premier also said ASEAN has a