Specific Taxes in Cambodia
Cambodia's tax landscape extends beyond corporate and personal income taxes, encompassing a diverse range of specific taxes that contribute to the country's revenue generation and policy objectives. These taxes target various aspects of economic activity, from consumption and property ownership to environmental protection and international trade.
Value-Added Tax (VAT)
VAT is a consumption tax levied on the sale of goods and services. It is imposed at a standard rate of 10%, with certain goods and services subject to reduced rates of 5% and 0%. Businesses engaged in the supply of goods and services are liable for VAT, with exemptions for specific transactions such as exports and financial services.
Property Tax
Property tax is an annual tax levied on immovable property owned by individuals or entities. The tax rate varies depending on the property's value and location. Property owners, including individuals, companies, and trusts, are subject to property tax.
Environmental Taxes
Cambodia imposes environmental taxes on activities that cause environmental harm, such as emissions, waste disposal, and the use of natural resources. These taxes aim to internalize the costs of environmental damage and encourage sustainable practices. Companies and individuals engaged in activities with environmental impacts, such as manufacturing, waste disposal, and energy production, are liable for environmental taxes.
Stamp Duty
Stamp duty is a tax levied on various legal documents and transactions, including property transfers, share transfers, and certain contracts. The tax rate varies depending on the type of document or transaction. Parties involved in transactions subject to stamp duty, such as property buyers, shareholders, and parties to contracts, are liable for the tax.
Capital Gains Tax
Capital gains tax is levied on gains realized from the sale of capital assets, such as real estate, stocks, and securities. Individuals or entities realizing gains from the sale of capital assets are subject to capital gains tax.
Customs Duties
Customs duties are taxes imposed on imports and exports of goods. The tax rate varies depending on the value or quantity of the goods being traded. Importers and exporters engaged in international trade are liable for customs duties.
Taxpayers Subject to Specific Taxes
The categories of individuals or entities liable for each type of tax vary depending on the nature of the tax. For instance, VAT is imposed on businesses engaged in the supply of goods and services, while property tax is levied on property owners. Environmental taxes target companies and individuals engaged in activities with environmental impacts, and stamp duty is payable by parties involved in transactions subject to the tax.
Purpose and Rationale
The specific taxes imposed in Cambodia serve diverse purposes, including revenue generation, economic regulation, and environmental protection. VAT is a significant source of government revenue, while property tax contributes to local government budgets and infrastructure development. Environmental taxes aim to internalize the costs of environmental damage and encourage sustainable practices. Stamp duty generates revenue for the government and may be allocated to various public services and initiatives. Capital gains tax helps ensure fairness in the tax system by taxing gains from asset appreciation, and customs duties generate revenue for the government and protect domestic industries by regulating international trade.
Legal Framework
The legal framework governing specific taxes in Cambodia includes the following statutes:
- Law on Value Added Tax (No. NS/RKM/0606/022)
- Law on Property Tax (No. NS/RKM/0606/023)
- Law on Environmental Protection and Natural Resources Management (No. NS/RKM/0606/024)
- Law on Stamp Duty (No. NS/RKM/0606/025)
- Law on Taxation of Income from Capital Gains (No. NS/RKM/0606/026)
- Law on Customs (No. NS/RKM/0606/027)
These legal texts outline the obligations, rates, and procedures for the collection and enforcement of specific taxes in Cambodia.
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