News1

  • Prakas on Licensing and Managing of Collective Investment Scheme Activities

    The Securities and Exchange Committee of Cambodia (“SECC”) has issued a Prakas on Licensing and Managing of Collective Investment Scheme Activities dated May 29, 2018 (“Prakas”). This Prakas is made to govern the business objective concerning the Collective Investment Scheme and its stakeholder for being effective, transparent and efficiency. It also stated the condition and procedure to provide license/approval, and the renewal of such lincese/approval and determind the certian oblication after recieving the license/approval. In according to this Prakas, they provide license to several type of establishments to conducts business activities which in line of Collective Investment Scheme. They are Fund Management Company, Fund Management Representative, Crowdfunding Representative, Distribution Company, and Funding Selling Representative… etc. Each establishment has two years license and three years-renewal. Abovementioned establishments is under the supervision of the Securities and Exchange Committee of Cambodia.

    Source: Prakas on Licensing and Managing of Collective Investment Scheme Activities, dated June 29, 2018

    Written on Tuesday, 10 July 2018 04:36 in Blogs Read 3370 times
  • GDT’s announcement on measure against taxpayers who fail to pay tax debt

    According to the announcement issued by the General Department of Taxation on 9 March 2018, it found that there is a number of enterprises that have not yet paid tax debt. Thus, it invites those who owes tax debt come to pay it at the GDT accordingly. In case that they fail to pay it, the GDT will post name of the enterprises and owners in media soon. Also, the GDT will pursue stringent measures in accordance with tax law by ceasing import-export, freezing taxpayer’s bank account, seizing taxpayer’s property, ordering to bring taxpayer to pay tax, transferring enterprise’s ownership over immovable property and nullifying any permits and licensing.

    Source: the General Department of Taxation’s Announcement no. 3350 dated 9th March 2018.

    Written on Thursday, 10 May 2018 06:38 in Blogs Read 2454 times
  • MFIs agree on faster collateral

    According to the annual general assembly of Cambodia Microfinance Association’s decision, the Association agreed to reduce time it takes for collateral to be returned from 10-15 days to three working days after they have fulfilled their obligation. It is noted that in 2017 the MFI sector’s portfolio is recorded $4 billion, which is equal to 25.5 percent increase.  The high proportion of the loans were taken by agricultural sector.

    Source: Khmer Times, 23th February 2018

    Written on Friday, 20 April 2018 03:46 in Blogs Read 1468 times
  • Digital signature one year out

    The system to authenticate electronic documents, which was approved by the sub-decree last year, will take at least another year before it is fully implemented. According to Mr. Ou Phannarith, the director of the department of ICT security at the Ministry of Post and Telecommunication, since there is no digital signature system in Cambodia, the origin of the documents are difficult to verify. He added that once the digital signature system is fully implemented, there is no need for in-person signature to verify the identity of the registrant in online platform such as taxation and business registration.

    Source: The Phnom Penh Post, 31 January 2018

    Written on Friday, 20 April 2018 03:44 in Blogs Read 1425 times
  • National Bank of Cambodia revokes license of 11 Rural Credit Institutions

    According to the announcement made on the 3rd of January 2018, the National Bank of Cambodia (NBC) has decided to revoke license of 11 Rural Credit Institutions or Operators. The NBC states that the reason for such decision is that these Institutions did not comply with the existing laws and regulations, and it also requests relevant authorities to take measures as appropriate. According to Chea Serey , director general of the NBC, “the closure of these 11 operators won’t have any impact on the industry as their size is negligible.”

    Source: NBC’s Announcement & the Phnom Penh Post, 04 January 2018

    Written on Friday, 20 April 2018 03:40 in Blogs Read 1537 times
  • GDT now allows you to pay the tax man online

    Mr. Kong Vibol, director of the General Department of Taxation (GDT), announced at the tax seminar yesterday that GDT has officially launched e-payment platform that allows individual and corporate taxpayers to pay their obligations online, directly through bank account or at local tax department branch with less procedural steps. He said that the e-payment platform is currently only available for taxpayers that hold account with Vattanac, Acleda and Canadia banks. He added that GDT will launch a separate e-filling system early next year that would allow taxpayers to submit relevant documents online without the need of mailing them to tax authorities or submitting them in person. However, a taxpayer expressed her opinion that “many taxpayers will not be familiar with the technology, and this could prevent them from benefiting from system and it will take time before everything runs smoothly.”

    Source: The Phnom Penh Post, 21 November 2017

    Written on Monday, 27 November 2017 07:08 in Blogs Read 1467 times
  • Minimum Wage for Workers in Textile, Garment and Footwear Industry for Year 2018

    At the 05th of October 2017, Ministry of Labor and Vocational Training issued an announcement about the determination of minimum wage for employees in textile, garment and footwear sector in 2018.  According to the announcement, the tripartite Labor Advisory Committee consisting of representatives of employees, employers and the royal government of Cambodia had discussed about the minimum wage in 2018 based on the seven determinants. Following the discussion, the representatives of employees set the minimum wage at $170, representatives of employer at $162 and the government at $165. As a result of deliberation, the minimum wage in 2018 is set at $170 effective from the 01st of January 2018.

    Furthermore, the announcement elaborates that other benefits that the employees used to enjoy will remain the same. Plus other benefits, on average, the employee will receive at least $187 to $198. Besides, the government also lessens the burden of the employers by allowing them to suspend the installments of tax on profit for five years (2018 to 2022) and removing export management fee with the Ministry of Commerce.

    On the same date, Ministry of Labor and Vocational Training further enforces the announcement by issuing Prakas No. 396 on the Determination of Minimum Wage for Employees in Textile, Garment and Footwear Sector in 2018. Article 1 of the Prakas states that the minimum wage for employees in textile, garment and footwear sector is officially set at $170 per month. According to Article 2, for employees in probationary period, the minimum wage is set at $165 per months and after the probationary period, they will receive $170 per months. In addition to that, other benefits will remain the same and the minimum wage will take effect at 01st of January 2018 according to Article 3 and 4.

    Source: Prakas No. 396 on dated 05 October 2017 on the Determination of Minimum Wage for Employees in Garment and Footwear Sector in 2018

    Written on Friday, 13 October 2017 08:28 in Blogs Read 9553 times
  • Prakas No. 559 on Instruction over Value Added Tax Implementation on Nontaxable Supplies

    Ministry of Economic and Finance (MEF) has issued the Prakas No. 559 dated May 25, 2017 on the instruction of the implementation for VAT on non-taxable supplies in accordance with the Article 57 of the Law on Taxation amended by the Law on Financial Management 2017. This Prakas aims to clarify the goods and services those are non-taxable supplies in order to ensure the consistency of VAT implementation.
    The Prakas applies to the self-assessment taxpayers in making non-taxable supplies below:

    1. Public postal service
    2. Hospitals, clinics, medical and dental services, and the sale of medical and dental goods incidental to the performance of such services
    3. The services of transportation of passengers by a wholly state owned public transportation system
    4. Insurance services
    5. Primary financial services
    6. The importation of materials for personal use those are exempt from customs duties in accordance with the customs provisions
    7. Non-profit activities for serving the public interest
    8. Educational service
    9. Electric power and clean water
    10. Unprocessed agricultural products
    11. Solid and liquid waste removal or collection services

    The Prakas specifically defined the term of “primary financial services” and includes certain kind of transactions and services which fall under the term as follow:
    - The deposition operations and granting loans except fees relating to such granting loans.
    - The initial securities public offering in the market, securities trade or other financial instruments, and the clearing and settlement services in the securities market.
    - Money Exchange Service
    - Security Service
    - Trading of Unshaped Gold
    NOTE: There was a significant event that the public misunderstand and misinterpreted that this Prakas was issued to impose VAT on above 11 goods and services supplies. Regardless, the Prakas was issued to clarify that the aforementioned goods and services supplies are exempted from VAT and they are called “non-taxable goods and services supplies”.

    Written on Thursday, 29 June 2017 08:44 in Blogs Read 27967 times
  • Identity Card, Family Book or Resident Book is not for collateral, NBC said.

    On May 22, 2017, National Bank of Cambodia (“NBC”) issued an Instruction No. T7.017.420 SJN in purpose to make a caution to all Bank, Financial Institution, and Credit Operator for stop accepting the Identity Card or Family Book or Resident Book as collateral. Last year, on March 11, NBC already issued an Instruction No. T7.016.210 SJN for informing those institutions after NBC observed and found that the Identity Card or Family Book or Resident Book was accepted and taken as collateral to secure the loan in some Bank, Financial Institution, and Credit Operator.

    Since now, NBC has acknowledged that several Banks, Financial Institutions, and Credit Operators are still accepting the Identity Card or Family Book or Resident Book in securing and release loan. This action is illegal under the Code of Civil and other regulation in force. Under Instruction No. T7.016.210 SJN, NBC has explained that the Identity Card or Family Book or Resident Book has no any economy value to be the collateral. Those documents are just the legal documents issuing by competent authority to identify a person and population statistic. NBC already warned that if any banks, financial institutions and credit operators fail to comply with laws and regulations in force, that institution shall be punished under the Law on Banking and Financial Institution.

    Under the Instruction No. T7.017.420 SJN on May 22, 2017, NBC wants to instruct those Banking and Financial Institution to get more attention for complying with Instruction on March 11, 2016 and Law on Banking and Financial Institution effectively. In its letter mentioned that if any banks, financial institutions and credit operators fail to comply, they would face with penalties such as withdrawal the licenses or the Registration Permit or stop the business activity in accordance with Article 52 and Article 56 of Law on Banking and Financial Institution.

    Written on Monday, 22 May 2017 03:08 in Blogs Read 15836 times
  • New Interest Rate Set by National Bank of Cambodia to All Microfinance Institutions

    It comes to a big surprise for financial analysts and all microfinance institution (MIFs) themselves after National Bank of Cambodia (NBC) issued a Prakas to order all MFIs under its supervision impose no more than 18% interest rate to all kinds of loan from 1st April this year.

    The Prakas is known as Prakas No. B7.017.109.P.K on Annual Interest Rate Ceiling Limitation issued on 13th March 2017. This Prakas aims to help reducing poverty by curbing any higher interest rates for Borrowers.

    In Article 5 of the Prakas has specified that all New Loans including Restructured Loans and Refinancing which is signed from this 1st April 2017 shall apply the new rule of Annual Interest Rate Ceiling Limitation. The Prakas is expected to be complied otherwise shall be subjected to the penalties as stipulated in Article 52 of Law on Banking and Financial Institutions.

    Written on Monday, 20 March 2017 02:53 in Blogs Read 8762 times
  • National Bank of Cambodia orders MFIs to step up lending in riel

    On December 1, The National Bank of Cambodia “NBC” issued a Prakas requiring all Micro-Finance Institutes (MFIs) to adopt measures to promote the usage of the national currency – Riel.  The implementation of this Prakas shall extend for three years.  Cambodian microfinance institutions are willing to comply with the new regulation which requires them to hold at least 10 percent of their loan portfolio in the currency of the Kingdom of Cambodia.

    Written on Tuesday, 06 December 2016 07:21 in Blogs Read 18657 times Read more...
  • Telecommunications Regulator of Cambodia (TRC)

    No. 1112 TRC 

    Guideline on Measure to Eliminate Mobile Phone Sim Cards without Identification Document,   

    Contradicted to Inter-Ministerial Circular No. 001, dated February 28, 2012 

    In the high spirited attempt by competent authorities to protect the national security, safety and public order, The Ministry of Interior (“MoI”) and Ministry of Posts and Telecommunications (“MPTC”) have issued the Inter-Ministerial Circular No. 001, dated February 28, 2012 on Telecommunication Services and Business Management which instructed all operators, branches and resellers to implement a protocol which requires all users of telecommunication services to complete a  telecommunication services form. 

    Written on Monday, 05 December 2016 13:28 in Blogs Read 65560 times Read more...
  • Minimum Wage for Worker in Textile, Garment and Footwear Industry for Year 2017

    The Ministry of Labour and Vocational Training (“MLVT”) has issued a Prakas determining the minimum wage for workers in the textile, garment and footwear industry for the year 2017.  This Prakas was published on September 29th 2016 - “Prakas No. 414/16”.  This Prakas was finalized subsequent to the meeting of The Labour Advisory Committee of Ministry of Labour and Vocational Training at the 8th mandate. This Prakas will become enforceable from January 1st, 2017.  The range of its enforceability shall extend to the following industries: textile, garment and footwear .

    Written on Monday, 05 December 2016 13:26 in Blogs Read 1662 times Read more...
  • Briefing on the Telecom Law in Cambodia

    Cambodia is a developing country and all sectors are growing very fast, especially the telecommunications sector.  Cambodian people ages 16 to 35 year olds are particularly interested in using the internet and enjoying new technologies with 3G and 4G services across a range of devices. 

    Written on Monday, 05 December 2016 12:56 in Blogs Read 1744 times Read more...
  • Circular On Application of withholding tax on fringe benefits

    This Circular follows the provisions in chapter 2 of Law on Taxation (LoT) proclaimed by Royal Kram No. នស/រកម​/0297/03, dated February 24, 1997 and Prakas No. 1173 សហវ.ពដ.ប្រក, dated 31 December 2003 on Salary Taxation to enhance standard of living and employment of employees and workers in all factories and enterprises in Cambodia.  Some benefits obtained from working shall be exempted and excluded from the tax on salary base and shall not be subject to the fringe benefit tax. These exempted fringe benefits are: 

    Written on Monday, 05 December 2016 12:43 in Blogs Read 6875 times Read more...

News2

  • Cambodia needs to diversify

    Cambodia’s economy is still healthy with GDP growth recorded 6.9 in 2017 as it has climbed to another level of economy status. This has been contributed by three sectors, namely tourism, construction and export. The increase in tourists by 10.4 percent in 2017 is attributed to direct regional flight and government’s policy. Also, the construction sector has reached a robust growth by going up 27 percent and number of machinery factories triples while export of textile contracts due to global market and local hurdles. Nevertheless, Cambodia is ranked 94 out of 137 in competiveness and this is caused by poor human resources, infrastructure and so on. This has indicated that Cambodia can no longer rely on old momentum for growth like garment and current export base like US and Europe, which is fragile to price and country shock.

    Cambodia can diversify its economy by producing goods with market potential such as sugar, palm oil and so on. Also, it can divert tourists to other potential destination like northeast provinces, which is ecotourism destination. In addition to that, Cambodia can improve its infrastructure by facilitating ways of transportation, reduce electricity cost and improve human resources by prioritizing science, math and soft skills in its education system. Furthermore, reforming regulatory framework for tax and corporations can be an opportunity while corruption, policy stability and logistics cost are still concerns for business. 

    Source: Khmer Times, 28th February 2018

    Written on Thursday, 10 May 2018 06:34 in News Read 2271 times
  • Keeping banks’ vultures at bay

    More than 100 senior level representatives from commercial banks, microfinance institutions, insurers and payment processing companies gathered in the Financial Industry Competency Building and Knowledge Sharing workshop on the 22nd of November 2017 to examine the challenges presented by the latest financial crimes and explore possible solutions. The workshop focused on money laundering, terrorism financing, cybercrimes and technological advancement to help companies comply with existing regulation. A managing director of a technology consulting firm said that “Cambodia’s financial sector has experienced remarkable growth in recent years, but warned that awareness of the banking system and the software and technology involved in the sector was still limited”.

    Source: Khmer Times, November 23, 2017

    Written on Friday, 20 April 2018 03:51 in News Read 1539 times
  • Chamber of Commerce Law forthcoming

    The draft law on the Chamber of Commerce is being reviewed by the Cambodia Chamber of Commerce. Once completed, the draft law will be sent to the Council of Minister for approval. It is noted that the new legislation will enable Cambodia to set up chambers of commerce in other countries and overseas investors to open branches in Cambodia. According to Mr. Lim Heng, vice president of the Cambodia Chamber of Commerce, the legislation will facilitate the private sector to obtain information on doing business in Cambodia. He added that Cambodia will set up offices in bigger countries with sizeable Cambodia population like Europe, United States and Canada. It is worth mentioning that currently Cambodia has commercial centres in Macaue, Nanning, Guangzhou and Beijing.

    Source: Khmer Times, 01 February 2018

    Written on Friday, 20 April 2018 03:45 in News Read 1447 times
  • Taxation agreement with Singapore in effect

    The Inland Revenue Authority of Singapore issued an announcement that the Double Taxation Agreement between Cambodia and Singapore, which was signed on 20th of March last year, comes into effect on the 1st of January 2018. The bilateral agreement aims to avoid double taxation as a result the application of tax laws in both countries and also lower the barriers to cross-border investment and boost bilateral trade. According to an expert, the agreement with Singapore has helped Cambodia gain invaluable experience in the negotiation of this type of treaties and it is a logical choice since Cambodia is a part of ASEAN and will integrate into the community. It is noted that on September last year, Cambodia also reached an agreement with Thailand.

    Reference: Khmer Times, 08 January 2018

    Written on Friday, 20 April 2018 03:42 in News Read 1326 times
  • Crypto Currency is Prohibited in Cambodia

    On the 5th of December 2017, the National Bank of Cambodia (NBC) announced that Crypto Currency like BitCoin and related instruments are not permitted by the laws, and the NBC does not recognize it. Crypto Currency advertisement and operation will put public at risk since it can be used as means for money laundering, financial termism and black market.  The NBC prohibits all banks and financial institutions from performing any transactions related to Crypto Currency and other related instruments, which is not recognized by the NBC.

    Source: Letter issued by the National Bank of Cambodia on December 5, 2017.

    Written on Friday, 08 December 2017 10:30 in News Read 1505 times
  • Prakas No. 448 on the Registration of Enterprises and Employee in the National Social Security Fund

    Ministry of Labor and Vocational Training has issued a Prakas on the registration of enterprise and employee in National Social Security Fund (NSSF) for all persons who are under the scope of the Labor Law of Cambodia. The Prakas aims at determining formality and procedure for registering enterprises, establishments and employees with Working Risk and Health Care Section of NSSF. It also obligates employers and owners of enterprise or establishment to register their entities with NSSF. Furthermore, employers and owners of enterprise or establishment have obligation to register employees with NSSF three days after the date of commencement of the work unless the employees have already possessed NSSF membership card. Non-compliance with this Prakas will result in penalty stipulated in Chapter five of Law on Social Security Fund.

    Source: Prakas No. 448 on the Registration of Enterprises/Establishments and Employee in the National Social Security Fund (NSSF), dated the 10th of November 2017.

    Written on Friday, 08 December 2017 10:29 in News Read 1862 times
  • Government reduces tax load on MFIs receiving money from abroad

    On 15th of November 2017, the Ministry of Economy and Finance (MEF) issued a Prakas to reduce withholding tax on interest from local microfinance institutions (MFIs) from 14 percent to 10 percent. The new Prakas aims at shrinking the expendable interest rates that MFIs take on loans from abroad to ensure the sustainability of microfinance sector. Also, the withholding tax rate reduction applies only on loans acquired abroad. It is known that the remaining 4 percent will be paid by the government.

    Experts said that “This Prakas is clearly intended to provide benefits to the people by reducing the cost of microfinance loans and MFIs on which these savings will be passed on to clients to be ensured.” This reflects the fact that the government has understood the MFIs’ Operations burden and the timeline for the reduction which will finish by the end of 2018, another expert said. He added that this period of time will give the MEF enough room to amend the fiscal policy, especially if a new government is formed after next year’s election. 

    Source: The Phnom Penh Post, 15 November 2017

    Written on Monday, 27 November 2017 07:02 in News Read 1296 times
  • Prakas on Management of Payment Transactions Services Institution

    The National Bank of Cambodia (“NBC”) has issued a Prakas on Management of Payment Transactions Services Institution dated 14th June 2017. The Prakas is made to determine the procedure for licensing Payment Transactions Services providers, to encourage fair competition and innovation and to gain public trust.

    The Prakas governs both Payment Transactions Services providers and Banks. However, services such as information technology support, data storage and processor, payment transactions using bank’s location and so on are excluded from the Prakas’s purview.

    Unlike Third Party Processor, which is a service provider or processor to facilitate bank’s payment transactions services and operations, Payment Transactions Services provider is independent. The Prakas has stipulated the scope of business of Payment Transactions Services provider in Article 6 and 7 that it can engage in businesses such as deposit and withdrawal in payment account service, money transfer service, payment transaction service, providing short term credit, issuing electronic currency, money changer and so on. However, money that Payment Transaction Services providers have received from payment transaction and issuing e-currency is not deemed to be deposit.

    To operate as Payment Transactions Services provider, legal entities must obtain license from the NBC. Legal entities need to fulfill numbers of conditions to obtain license from NBC. For example, legal entities need to describe the type of payment transaction service that it will operate, business plan, evidences of capital sufficiency and so on. On top of that, the Prakas requires the legal entities to have minimum capital of 8,000 million Riel (around USD2 million) in cash and 5% of the minimum capital must be deposited with NBC. Nevertheless, the license to operate as Payment Transactions Services provider is valid in six years but it is renewable.

    With regard to fee, legal entities need to pay 500,000 Riel (around USD125) for application form plus inquiry and 2,000,000 Riel (around USD500) for having the documents reviewed. Also, legal entities are required to pay annual fee of 20,000,000 Riel (around USD5000).

    The Prakas also states about merger and acquisition in Article 24 that Payment Transactions Services providers must gain approval from NBC if it intends to merge with other institutions, transfer or be acquired in part or whole of its business or cease its business operation. Besides, NBC has right to delicense or suspend any Payment Transactions Services providers’ operation that fail to operate within six months, engage in fraud or forgery, be non-compliance with NBC’s supervision and so on.

    Written on Thursday, 10 August 2017 08:47 in News Read 5601 times
  • Prakas on Modification of Prakas No: 047 MOC/SM dated in 2013 on Price Tag in Riels Currency

    On July 07, 2017, Ministry of Commerce has issued a Prakas No: 172 MOC/PK to modify the Prakas No: 047 MOC/SM dated January 23, 2013 concerning the price tag in Riels currency. This new Prakas was issued to impose all Traders, Venders, and Service Providers in Cambodia to put the price tag in Riels currency on their selling products and services. The Prakas is purposed to promote the transparency of the national currency over the goods, product, and service charged in Cambodia.

    However, some business area, called “Duty Free”, which are licensed by the Government to have price tag in foreign currency, they are required to have an approval from Municipal or Provincial Department of Commerce of the place of business. The approval is valid for one year and it is subject to be renewable. The approval shall be submitted with the required documents where consist of Application Form, Certificate of Incorporation, latest Patent Certificate, ID Card or Passport, and three of 4 X 6 photos. All Duty Free Shops who held an approval to have price tags in foreign currency has duty to pay the public free as stipulated in Public Official Fee of Ministry of Commerce.

    Written on Tuesday, 01 August 2017 08:29 in News Read 1758 times
  • Filing of Annual Declaration of Commercial Enterprise

    Ministry of Commerce has issued a new Prakas No. 107 MOC/SM on “Filing of Annual Declaration of Commercial Enterprise” on 05th April, 2017 and at the same time nulled Prakas No. 104 MOC/SM dated on 07th April, 2008.

    Since the registration system has been available to conduct online, filing annual declaration of Commercial Enterprise is too available and required to file online. All commercial enterprises will be sent a notice to file their annual declaration in the eleventh month and are required to start filing them including other references in the twelfth month counted from the date of their commercial registrations through online system. The duration for filing is provided for three months following from the beginning date of the abovementioned twelfth month
     
    In case any commercial enterprise fail to comply with this prakas to file the annual declaration, they will be imposed under penalties set force in the laws and this Prakas. The sole Prakas will penalize 1 Million Riels for such failure.

    The Prakas has indicated some particular information to be filled in the online system for all commercial enterprise including Taxpayer Identification Number (TIN), Tax Registration Date, Patent Certificate in the year of filing the annual declaration, number of employees including referenced documents specified on their duties, currently used phone numbers and email addresses of the company. It is, however, important to note that except Public Limited Company is required to submit other additional informations to the above listed which include financial statement and the company’s owner record.

    Written on Tuesday, 18 April 2017 02:59 in News Read 9518 times
  • Suspension on Issuance of New Central Counterparty License to Derivatives Trading Firms

    On March 20th, Securities and Exchange Commission of Cambodia (SECC) issued an announcement to inform the public that SECC temporally stop accepting application for licensing a New Central Counterparty License to Derivatives Trading Firms. Notwithstanding, SECC still encourage persons who want to be a Derivative Brokerage firm and unlicensed Derivative Brokerage firm promptly apply the application. Those who are unlicensed Derivative Brokerage firms failed to get the license from SECC are warned to faced legal action.

    For the public information, SECC listed the current four licensed Central Counterparty companies and six licensed Brokerage.

    In the same announcement, SECC added that it will carry on accepting the application for licensing a New Central Counterparty License to Derivatives Trading Firms in the future with the date will be specified in another announcement.

    Written on Thursday, 23 March 2017 02:56 in News Read 1755 times
  • GDT Exempts Some Tax Obligations while Also Tend to Strengthen the System

    On 22nd January 2017, General Department of Taxation announced (GDT) for a “Tax Amnesty” for the registered taxpayers who failed to pay and those who failed to declare the tax up to three years from the filing date. The amnesty, however, will only exempt the tax penalty for the aforementioned failings. Since the penalties are imposed in series as from 10, 25 or 40 percent which is quite significant, the amnesty tend to encourage the taxpayers to pay theirs owed tax by exempting such penalties. This exception will only officially announce and enter into force by GDT this early April.

    In addition to the penalties exemption, there is another sub-decree signed by Prime Minister Hun Sen and dated early of February 2017 to exempt tax on profit for Small-Medium Enterprises (SMEs). This exemption intends to push up the SMEs to voluntarily and formally register their businesses tax in GDT as the condition to be exempted. The period of tax on profit exemption will last for “Two Years” till the end of 2018.

    Despite there are some incentive tax policies, it is important to note that the “Tax Code Amendment” through 2017 law on financial management appeared to strengthen the tax system. The amendment was seen to provide a clearer authority for “GDT Auditors” to intensively audit on the distinction between the bank statement and the tax returns. The empowerment of such authority is to prevent taxpayer avoiding on provide a full information. GDT authorities now have power to directly request to the bank to provide the bank statement of the taxpayer being audited.

    Written on Friday, 03 March 2017 02:45 in News Read 2796 times

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