The government is taking more tax initiatives to support the recovery of tourism sector  in addition to measures aimed at controlling Covid-19 pandemic and helping the most severely affected businesses in the country even though the number of tourists is increasing, according to a statement from the finance ministry.

The additional tax measures were taken amid threats of Covid-19 and global inflation that have put pressure on the number of tourists and many operators in the tourism sector still face challenges in their business, the statement said.

“In this regard, the government has worked with the private sector and relevant ministries and institutions to prepare and release further measures for the tourism sector accordingly,” the statement specifies, adding that the government will continue implementation of waiver of payment of all of types of taxes, except valued added tax (VAT).

The waiver is set for hotels, guesthouses and tour agents that are registered with the General Department of Taxation and have business activities in Phnom Penh, Siem Reap and Preah Sihanouk
from July to September this year, according to the statement. “Those businesses still have obligation to do filing … every month during this period,” it says.

Chhun Makara, director of travel agency, transport and tourism guide department at the tourism ministry, told Khmer Times yesterday that the government will subsidize the amount of taxes that tourism businesses in the three cities are obliged to pay, but the new measures exclude the exemption of VAT.

“The government has seen that the economic activities have resumed after the pandemic  eased and so the consumers probably now have the ability to pay tax as VAT is the burden of tourism service or product consumers, not providers,” said Makara, adding that the government will consider more extension of the new three-month period depending on the real situation.

The statement adds that the government will freeze the number of tax debt as of 2019 and will not penalize tourism businesses for 2022, but urges them to set up skill development programs for their employees and to request for financial support from the Skill Development Fund in case of necessity.

Din Somethearith, president of Cambodia Hotel Association, told Khmer Times yesterday that hotel owners are obliged to pay many types of taxes such as profit tax and tax on accommodation, which is a very heavy burden on them in running their businesses.

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