Gov’t to raise 20% more tax revenue
Gov’t to raise 20% more tax revenue
As part of efforts to achieve a sound macroeconomy, the government plans to increase the revenue raised from taxation and customs and excise by more than 20 per cent next year.The 2020 national budget law approved on Tuesday targets a 28.1 per cent increase in revenue collection from customs and excise next year, reaching around $2.87 billion, or 17.72 per cent of gross domestic product (GDP).
Revenue from tax collection would increase by 21.3 per cent to more than $2.33 billion, accounting for 7.93 per cent of GDP, it said.
“The government will not impose new taxes or increase existing tax rates,” the law says.
Speaking at the National Assembly on Tuesday, Minister of Economy and Finance Aun Pornmoniroth said that while the Kingdom’s economy remained strong, the government had to spend more to sustain the economy and boost domestic revenue via the collection of tax and customs duties.
“The government has achieved good results in public financial management with the sound, sustainable and efficient collection of all types of taxes.
“This proves the strength of the Cambodian economy, despite the global economy facing greater risks than before. Higher revenue collection helps strengthen Cambodia’s budget independence, and gives the government greater control,” Pornmoniroth said.
Kong Vibol, the director-general of the ministry’s General Department of Taxation (GDT), could not be reached for comment on Wednesday.
However, he said in a report released last month that the key driver of revenue growth over the past year has been the government’s efforts in implementing its Rectangular Strategy and Revenue Mobilisation Strategy, which focus on strengthening fiscal administration reform.
Such measures include “the modernisation of the tax administration’s core functions and support of the General Department of Taxation, such as the introduction of the e-VAT system”, Vibol said.
The government is also strengthening tax administration, adopting information technology to prepare audits and promote a tax culture among taxpayers, he added.
Last month, the International Monetary Fund (IMF) Staff Completes 2019 Article IV Mission to Cambodia press release said the Kingdom’s robust revenue performance continued, with – thanks to strong administrative efforts – tax revenue nearing 19 per cent of GDP last year.
“Looking ahead, strong implementation of the authorities’ new Revenue Mobilisation Strategy 2019-23 should help sustain revenue growth through tax policy and revenue administration reforms,” the IMF said.
It said Cambodia’s public debt remained low, at 28.6 per cent of GDP last year.
The IMF said the Kingdom was expected to remain at low risk of debt stress despite an increase in both debt disbursements and public-private partnerships to finance needed infrastructure investment.
The government collected some $4.567 billion in revenue from customs and taxation in the first nine months of the year, said a GDT report last month.
