US Tariffs on Cambodia: ‘97 percent false claim, Trump team manipulating numbers’, says expert

US Tariffs on Cambodia: ‘97 percent false claim, Trump team manipulating numbers’, says expert

While announcing a 49 percent tariff on goods imported from Cambodia, US President Donald Trump yesterday said the Kingdom is taxing US goods at 97 percent. Experts now wonder where the mysterious number has emerged.

Speaking to Khmer Times, Edwin Vanderbruggen, senior partner of Andersen in Cambodia, a leading legal, tax and non-regulated services advisory firm, said the Trump team is simply manipulating the numbers.

“They add VAT and excise and special taxes, even though all of them also apply to domestic goods, not just imports. So, they don’t count as a tariff at all, domestic sellers also pay them. Look at Singapore, it does not even have any customs duties and the Trump team still claims they have tariffs against US goods. It has been just manipulated to make it look like something it is not.

“They also seem to have included Cambodia VAT on digital services like payments to Google, Facebook and Netflix. As if an emerging country like Cambodia should not be allowed to levy any tax at all on those tech giants, who otherwise pay nothing here. Is that fair, perhaps?” he asked.

Edwin stressed that the Kingdom levies only seven percent on average and gives zero percent to the US and many other World Trade Organisation (WTO) members on many goods.

Explaining further, he said, “Obviously, this is a highly destabilising move. Thirty-eight percent of Cambodia exports go to the US and most of the imports come from China. So we are stuck in a very vulnerable position on both sides.

“The statement by the US that Cambodia imposes very high tariffs is just false. They have counted the VAT as a non-tariff barrier, but that applies also to domestic products, so that is just false, plain and simple.

“WTO agreements since 1947 are clear that a country can have ‘internal taxes’ like VAT. I guess they choose to ignore that.

“A small silver lining is that our main competing countries for garment exports are treated just as poorly as Cambodia, such as Bangladesh, Vietnam and China. This might slow down an exodus of mobile manufacturing, although Turkey will pick up more orders.

“The argument that they only reciprocate is just not true. Look at Singapore, it does not even have customs duties. It’s just not objectively justifiable.”

Arnaud Darc, an entrepreneur based in Cambodia and the Chief Executive Officer of Thalias, posted a detailed explanation on his social media, questioning the numbers presented by the Trump team.

“This image recently surfaced on US television, showing a chart shared by the Trump administration suggesting Cambodia charges 97 percent tariffs on American imports. At first glance, it’s shocking. But dig deeper, and it becomes clear: the number is misleading and politically charged, not based on any official tariff schedule or WTO-backed data.”

Highlighting his credentials as an importer and business operator in Cambodia, he showed the taxing stages and rates when the US goods entered the Kingdom.

“Import duty rates range from 0 percent to 35 percent, depending on the product category. Then there is a flat 10 percent VAT. Special tax (excise) applies to specific goods such as alcohol, vehicles, tobacco, etc. and another three percent on certain luxury goods.”

He said that to import a bottle of US wine, the total tax burden would be about 100 percent. However, to import a laptop manufactured in the US, the total tax burden would be only 10 percent, he pointed out.

“This is how tariffs are applied: product-by-product, by HS Code, not by country-wide blanket percentages. So, where did the 97 percent number come from? It’s unclear. It doesn’t match Cambodia’s Customs Tariff Book, nor data from the WTO, Asean Trade Repository, or Cambodia’s General Department of Customs and Excise. Most likely, it’s a political construct, lumping together.

“These kinds of graphics may be catchy, but they oversimplify and distort the reality of international trade. We owe it to business leaders, investors, and policymakers to rely on accurate, verifiable data, not scare tactics. Cambodia is not a high-tariff wall against the US. In fact, the Kingdom imports millions of US goods every year, and the tariffs applied are fully in line with WTO standards. Let’s build smarter trade, not louder headlines,” he added.

Victor La, Director of Strategic Planning at the Canadian Chamber of Commerce in Cambodia (CanCham), said Trump’s reciprocal tariffs are a real wake-up call for us to support local business, buy local to sustain the economy.

“While also moving forward with business transformation and capacity to make sure that we are able to have a productive economy in the future. We all need to work together now more than ever.

“We really need to rally up the business community and the government to move and take action on this.”

khmertimes