Tax holiday on farming, industry extended

The Phnom Penh Post
http://www.phnompenhpost.com/

Written by Chun Sophal
Tuesday, 02 June 2009

FINANCE Ministry officials say they are adding three years to the tax holiday on agriculture and industry investments, Minister of Finance Keat Chhon announced to the National Assembly at the weekend.

"We will not collect profit tax for an additional three years from this year on," said Keat Chhon.

According to Cambodia's law on taxation, all companies are required to pay a 20 percent profit tax after a six-year exemption. The new rules would raise that to nine years.

Khaou Phallaboth, president of Khaou Chuly Group, which invested in 10,000 hectares of rubber plantations in Stung Treng province, said Monday he welcomed the new tax break, adding that it would give the sector a much-needed boost.

"This is a good way of getting us out of financial difficulties," he said.

He said since 2008 companies had been under pressure because of lower rubber prices.

Yang Saing Koma, president of the Cambodian Centre for the Study and Development of Agriculture (CEDAC), said the tax breaks would only help large companies.

"I think that the government should consider helping poor farmers and their communities because [farmers] are important for food security and they provide jobs," said Yang Saing Koma.

Chan Tong Yves, secretary of state for the Ministry of Agriculture, said the tax break would help small and large companies and would encourage food processing.

"We think that all investors in agriculture will welcome these moves by the government,' Yves said.
The government could not confirm how much tax revenue would be lost as a result.