Tax intake rises but opposition claim losses

[PHNOM PENH POST]

Cambodia's tax revenue rose by 12 per cent to US$575 million year-on-year in 2011, according to data from the Ministry of Economy and Finance (MEF).

The rise was due partly to increased collections of profit taxes, excise taxes and duties totalling $13 million, says MEF Secretary of State Hang Chuon Naron.

He said other increased taxations contributed as well, with property tax collections alone totalling $12 million last year.

“We are trying to increase tax collections in order to increase revenues and the national budget,” he said.

Son Chhay, a national assembly member of the Sam Rainsy Party, said that Cambodia loses millions each year on negligent tax and excise revenue collection.

“We have lost between 25 to 35 per cent of tax revenue each year at the hands of customs officers because they don’t look at the exact number of products. They just try to collect a target set by the Ministry of Economy and Finance,” he said.

Tax revenues increase from 10.7 per cent of the overall GDP in 2010 to 11 per cent of the GDP last year, with non-tax revenues slightly decreasing from 2.3 per cent of the GDP in 2010 to two per cent of the GDP in 2011.

With the new taxes being set up and pursued more thoroughly, Son Chhay said Cambodia could potentially lose $1 billion due to hasty methods and innacurate reports.

He also said that powerful officials often pay less in taxes than others, and encouraged them to be more transparent with the taxes they pay.

He added that the telecom sector had also costed the Kingdom in potential tax revenues because the Ministry of Post and Telecommunications did not have a clear billing system and often just relied on a companies’ own reports.