GDT brings in $20.9M of e-commerce VAT over Q1

GDT brings in $20.9M of e-commerce VAT over Q1

The e-commerce VAT, which has been implemented for less than a year, has been presented as a new contribution to state coffers from the burgeoning local high-tech business community.

Speaking to The Post on May 7, Cambodia Chamber of Commerce vice-president Lim Heng drew attention to the ongoing trend of rapid development in the digital payment space as well as the accompanying rise in high-tech businesses, which he noted was especially evident during the height of the pandemic.

Businesses have been embracing digital solutions to serve the needs of consumers who would prefer to shop online, and e-payment options are becoming increasingly convenient with real-time transaction processes, he said.

Royal Academy of Cambodia economics researcher Ky Sereyvath remarked that the rapid growth of the local e-commerce market bodes well for the Kingdom’s digital-economy ambitions.

“E-commerce is becoming more and more important for [Cambodians’] daily lives as plenty of people, especially in urban areas or major provinces, prefer to buy goods and services online rather going directly to any outlet or wet market,” he said.

“This trend illustrates how very fast we’re moving towards adoption in the digital world.”

On March 31, 2022 the Ministry of Commerce formally launched CambodiaTrade with integrated marketing solutions, regarded as a key component of the Cambodia e-Commerce Development Project (Go4eCAM). This was about half a year after the platform’s soft-launch in September 2021.

The e-commerce platform is said to be in line with the government’s long-term vision of maximising the value earned from the Fourth Industrial Revolution (4IR).

At the launch, commerce minister Pan Sorasak said the platform would be an important engine for economic diversification while providing exposure in the domestic and international markets for Cambodian products.

He attributed the development of the underlying digital technology to the Kingdom’s industrial development policy as it pertains to economic diversification, adding that the e-marketplace would connect local small- and medium-sized enterprises (SME) to regional and global value chains.

The minister opined the technological revolution and digital transformation brought about by the 4IR are key to boosting the competitiveness of enterprises and business processes. As such, these phenomena should significantly contribute to improving productivity, increasing exports, creating jobs and stimulating the national economy, he contended.

According to the National Bank of Cambodia (NBC), the number of e-wallet accounts in the Kingdom reached 17.9 million at end-December amid an acceleration in electronic payment volumes driven in part by Covid-19 anxiety, reflecting gradual fintech (financial technology) development towards achieving the government’s digital economy objectives.

Meanwhile, the GDT and General Department of Customs and Excise of Cambodia (GDCE) – both of which are under the Ministry of Economy and Finance – collectively netted $1.908 billion in revenues in the first quarter of 2023, marking just over 30 per cent of the full-year target, official figures show.

Individually, the GDT reported that it collected $1.34390 billion in the January-March period, or 37.63 per cent of its $3.5717 billion full-year target. An earlier GDT notice put the first quarter 2022 figure at $1.26307 billion, which would suggest a 6.40 per cent increase on an annual basis, barring revisions of the 2022 numbers.

At the same time, the GDCE registered $564.1 million for the three-month period, representing just 20.5 per cent of its full-year target, albeit a 5.2 per cent year-on-year drop.

Accounting for rounding, this indicates that GDCE revenues during January-March 2022 fell in the range of $594.675-595.409 million, indicating a slight reduction from the $597.6 million earlier reported for that period.

The full-year targets are set in the 2023 Law on Financial Management.

phnompenh post