Laws, tax collection lacking, gov’t says
Laws, tax collection lacking, gov’t says
A lack of regulations coupled with tax breaks provided to attract investors to the Kingdom are major reasons for low receipts in 2013, according to a government statement presented before a National Assembly committee yesterday.
Following a review of the 2013 National Budget, the Ministry of Economy and Finance found that a lack of tax regulations in the natural resources, casino and telecommunication sectors were hampering collection efforts in these industries.
At the same time, free trade agreements, reduced imports and government subsidies on certain products were limiting state revenue potential, the audit found.
“Cambodia has a gambling law, but we do not have a casino law. The government is drafting the law now. What we can do in the meantime is to have authorities go in and look at their revenues and evaluate for volunteer contributions before we can implement fiscal taxation,” said Cheam Yeab, chairman of the National Assembly’s Second Commission on Economy, Finance, Banking and Audit.
On the personal tax collection front, revenues were up because of simplification and updating of the collection system, the statement went on to say.
Yeab said that the government will have stricter tax collection measures this year and warned the private sector to pay up its tax debt or risk having their bank accounts frozen, licence revoked or even face legal action.
Son Chhay, vice chairman of the Second Commission, said the country has lost millions of dollars due to the lack of tax collection, regulation and monitoring. He raised doubts over the government’s claims, saying that there was not enough information provided to make a clear assessment on state income.
“We are not sure if it is about the lack of regulations as we are told or is it about the plotting between the government and private companies. We need more reports and audits on the expenditure,” he said.
Srey Chanthy, an independent economic analyst, said loopholes found in public institutions remain a major challenge in tax collection. The lack of punishment for late or nonpayment, especially for government-back businesses, and the limited use of technology has hindered the increase in revenues.
“Improving tax collection with transparent, equal and easy processes, in addition to exact tax rates based on the of businesses, will increase government revenues,” he said.
