Nation nears tax collection target amid challenges
THE government has amassed over $3 billion in taxes during the first ten months of 2023, reaching 85.87% of the target set by the 2023 Law on Financial Management. The General Department of Taxation (GDT) has pledged to enhance work efficiency in the future, particularly in aiding the private sector, following directives from Prime Minister Hun Manet.
The outcomes of a meeting led by Kong Vibol, director-general of the GDT, with relevant officials, were detailed in a GDT press release on November 15.
During the gathering, Vibol emphasised the need for officials at all levels to focus more on strategies to encourage and assist the private sector in taxation, in line with the government’s recommendations.
For the first ten months of 2023, total tax revenue amounted to 12.421 trillion riel ($3.018 billion), equating to 85.87% of the budget target.
In October, the government collected approximately 1.055 trillion riel (about $256.39 million) in taxes, representing 7.29% of the planned yearly goal.
The GDT reported that during these months, the body registered 13,433 enterprises, conducted 843 seminars and training courses, provided consultation in 98,398 taxpayer cases, addressed 29,924 information technology-related issues, resolved 368 audit complaints, developed five software systems, approved tax avoidance agreement proposals for 365 enterprises and successfully collected 254.41 billion riel ($61.82 million) in taxes from e-commerce.
Vibol advised reinforcing the promotion and implementation of tax policies in the private sector, echoing requests made by the prime minister during the 19th Government-Private Sector Forum on November 13.
“The GDT remains attentive to the advice of the Minister of Economy and Finance [Aun Pornmoniroth], which provides further guidance for enhancing taxpayer services, addressing the private sector and public challenges, increasing tax awareness and education and executing tasks in accordance with the Standard Operating Procedures [SOP] for all work and tax-related processes,” he stated.
Hong Vannak, an economist at the Royal Academy of Cambodia, attributed the lower percentage of collection in October to the ramifications of the economic crisis, particularly the impacts of the Russia-Ukraine war, the Israeli-Palestinian conflict, some tax deferrals and the prolonged processing of certain documents.
He suggested that in the future, tax collection could align with or even exceed the plan if conditions turn favourable, given the recovering economic trend in the Kingdom.
“Taxes are crucial as they form the backbone of the government’s spending, covering civil servants’ salaries, repaying foreign loans and financing from foreign institutions, contributing to the national budget for public service infrastructure and strengthening state institutions,” he explained.
He added that increased revenues would enable the government to invest more in national development and societal welfare, particularly aiding vulnerable groups.