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Cambodia: GDT sets guidelines for pre-dividend division tax payment
The General Department of Taxation (GDT) on Thursday last week released a set of guidelines for owners of legally registered qualified investment projects (QIPs) and non-QIP businesses to follow in fulfilling their obligations of paying taxes before they distribute dividends based on the tax and investment laws of Cambodia.
The guidelines are divided into two parts—procedures to set the pre-dividend division tax calculation base and the taxes to be paid before dividend division. The latter refers to the taxes on annual income that are pre-paid to the taxation administration for dividing dividends from income before payment of tax on annual income, say the guidelines.
“The taxation general department strongly expects that all enterprises that are taxed under self-declaration regime and do business in Cambodia pay high attention to the implementation of the guidelines very effectively,” the guideline pointed out with examples of the calculation of tax base and tax amount to be paid.
If a company taxed at 20 percent distribute 40,000,000 riels of dividends to its shareholders in September 2022 and the dividends are taken from its annual income in the current year before paying tax on annual income, the company is required to pay 10,000,000 riel tax before the distribution of dividend for the month.
GTD of the Ministry of Economy and Finance (MEF) has collected more than $2.94 billion of tax revenue for the period of the first 10 months this year, which passes the amount set in the budget law 2022. The tax revenue for the first ten months has passed the amount set in the budget law 2022 by 4.48 percent —104.48 percent of the target set in the budget law 2022.
The draft law on financial management for 2023—approved by the Office of the Council of Ministers on October 28, 2022, attended by Prime Minister Hun Sen—requires GDT to collect more than $3.57 billion or 26.70 percent compared to the amount set in the budget law 2022—about $2.82 billion.
Kong Vibol, Director General of GDT, said the new target for 2023 which will be about $752.16 million higher than 2022 would probably be very tough for the internal tax authority to achieve. “I am committed and do my best in completing the mission to collect the tax revenue unwaveringly … to further fully support the implementation of the government’s policies,” Vibol said.
Source: https://www.khmertimeskh.com/501205206/gdt-sets-guidelines-for-pre-dividend-division-tax-payment/