E-commerce tax revenues surpass $39M in first half
E-commerce tax revenues surpass $39M in first half
The General Department of Taxation (GDT) has reported that it collected “taxes” from e-commerce transactions to the tune of 159.21 billion riel, or $39.31 million, in the first half (H1) of the year, with last month accounting for 27.55 billion riel or 17.3 per cent of the total.
This was disclosed in a statement issued in connection with a July 13 meeting to discuss the H1 results of the GDT’s tax collection, and observers have expressed hope that these figures will keep climbing for the foreseeable future.
Although not explicitly mentioned, The Post understands that these totals are specifically for value-added taxes (VAT), which the department only began collecting on April 1, 2022.
For comparison, the GDT earlier posted $37.62 million in VAT from e-commerce in 2022 as well as 84.67 billion riel for the first quarter of 2023. The department tends to use a flat 4,050 USD/KHR conversion rate in these reports.
In a July 16 interview with The Post, Royal Academy of Cambodia economist Hong Vanak reflected on what a relative newcomer the Kingdom is to tax collection on e-commerce transactions, noting that online shopping is gaining ground in virtually every country.
Vanak suggested that increases in the collection of these taxes would in turn signal an uptick in e-commerce activity in the Kingdom.
“It is a budding success story for GDT, and it comes from improvements to make tax administration more accurate and transparent for taxpayers. Tax revenues from e-commerce transactions will remain on an upward growth path,” he predicted, noting that a spate of new domestic investments has led to a steady increase in overall tax revenues.
Speaking to The Post in February, Cambodia Digital Tech Association president Chhin Ken remarked that digitalisation has significantly impacted all facets of Cambodian manufacturing and production, from small enterprises to international commerce.
He claimed that as the popularity of smartphones has grown, so too has the usage of advanced technologies, which has generally resulted in lower prices and less lost time.
Modern technologies are spurring economic growth as well as “greatly improving markets for agricultural products; by using these solutions, producers can send images of their products directly to consumers promptly and at minimal costs”, he said.
The July 13 statement noted that the GDT registered $2.07239 billion in revenues in the first six months of this year, which is equivalent to 58.02 per cent of the $3.57170 billion annual target, as outlined by the 2023 Law on Financial Management.
At the accompanying meeting, GDT director-general Kong Vibol commented that Cambodia’s tax system has seen marked improvements thanks to modernisation efforts and reforms, specifically those “since 2012”.
Tax officials at all levels are contributing to the GDT’s administration modernisation and reform goals as well as ensuring the sustainability of the department’s revenues, he said.
The Royal Government of Cambodia (RGC) late last month reaffirmed its forecast that the Kingdom’s economic growth will improve from 5.2 per cent in 2022 to 5.6 per cent this year.
