GDT hopes to collect over 107% projected tax revenue for 2023
GDT hopes to collect over 107% projected tax revenue for 2023
Tax revenue in 2023 is expected to achieve 107.5 per cent of the 2023 Law on Financial Management, though the projection is lower than the collection achievement last year.
In the first seven months of 2023, revenue collection reached 65 percent or 9.4 trillion riel ($2.3 billion), according to the General Department of Taxation (GDT) on August 24.
“It is estimated that by the end of 2023, tax revenue will reach 107.5 per cent of the law, reflecting the effectiveness of efforts to implement GDT’s strategic and operational plans,” it said.
The law has set out plans to collect more than $3.6 billion this year, however, the department stated that some segments are facing challenges.
For instance, property tax collection amounted to 57 billion riel (about $14.25 million), which is only 37 per cent of the target set for the segment.
In 2022, GDT collected $3.5 billion in tax revenue, up 24 per cent year-on-year or $667.3 million, which was equivalent to 122.5 per cent of the 2022 Law on Financial Management.
To boost tax collection this year, the GDT has issued notifications to remind taxpayers to pay their taxes on time to avoid penalties as stipulated by the tax law.
Hong Vanak, an economics researcher at the Royal Academy of Cambodia (RAC) observed that tax revenue has steadily increased over the years, barring the pandemic.
The positive collection rate is due to two main factors, he told The Post. “The first is, there has been more effective implementation of the law by the GDT and the second, there is more active awareness and participation of those in charge.”
He added that tax revenue is indicative of the growth of local production and business.
“With the continuous updating of tax procedures and commitment by the GDT, I am optimistic that the collection of tax revenue in 2023 would achieve the projected target,” Vanak shared.
Tax revenue would grow higher if the global economy improves as this would help businesses recover.
“Tax revenue is an important source of funding for the government to develop the country through the training of human resources, construction of public infrastructure and in attracting investment,” Vanak said.
On August 17, GDT director-general Kong Vibol said although revenue collection continues to maintain positive signs, uncertainties in the global economy and geopolitical crises, especially the Russia-Ukraine war continue to put pressure on companies and countries that are a source of capital for large investments in Cambodia.
“Rising inflation could be a risk in managing uncollected tax revenue in accordance with the 2023 law,” he said, adding that this might impact the target for next year.
