Cambodia: GDT earns $21 million on e-commerce VAT income in Q1

• Apr 25, 2023

The General Department of Taxation earned e-commerce value-added tax (VAT) income of $21 million from the operation of electronic goods and services in the first quarter of this year.

GDT said in a meeting last week that in January alone the tax income from e-commerce was $6 million.

The average tax income from e-commerce was $7 million in the first three months, higher than $5 million for the same period last year.

GDT has been conducting further research to understand the tax collection management of e-commerce VAT from tax administrations in various countries.

“As e-commerce grows, GDT expects the sector to continue to grow, which will boost tax revenue from e-commerce and maintain sustainable growth year on year,” it said.

The usage of digital devices, e-commerce transactions during the pandemic and financial technology boosted internet and mobile services in the country.

The mobile phone subscribers in Cambodia reached 19.5 million by November last year, a decrease from 21.7 million in 2019, according to the Telecommunication Regulator of Cambodia’s report.

The government started implementing e-commerce VAT in April this year and taxed companies including Google, Facebook, YouTube, Alibaba, Microsoft and TikTok.

GDT earned around $44 million in tax revenues from the e-commerce sector from April to December last year.

VAT of 10 percent on e-commerce transactions has been in force since April 1 in Cambodia.

Its director-general Kong Vibol recently said that the VAT on e-commerce was a potential source of revenue for the country.

Cambodia sees it has the potential to increase the national budget revenue further, he said, adding that the taxes on foreign e-commerce transactions also put the local e-commerce operators on an equal footing.

In the past, foreign companies did not pay income tax and VAT in Cambodia.

GDT of the Ministry of Economy and Finance collected $1,343 million in tax revenue in the first three months of 2023.

The Kingdom has two institutions for collecting taxes.

One is GDCE, which collects taxes on goods entering and leaving the country, and the other is GDT, which focuses on interior taxes such as income tax, salary tax, value-added tax, and property tax.

In 2023, the government targets $5.5 billion as income from tax and customs, an increase of nearly 16 percent compared to 2022.

Source: https://www.khmertimeskh.com/501278433/gdt-earns-21-million-on-e-commerce-vat-income-in-q1/