The Cambodian government has announced two months more of tax exemptions for tourism-based businesses in the hope of easing the burden during the pandemic.
The extension was announced during the fifth round of COVID-19 economic measures last week as the Ministry of Tourism begins developing a strategy to gradually increase international tourist arrivals.
The announcement includes all types of monthly tax exemptions for hotels, guesthouses, restaurants and travel agencies registered with the General Department of Taxation from August to September. The government will also extend the minimum tax exemption for another two months to registered aviation businesses.
According to the announcement, the government will continue to provide a monthly stipend of $40 a month for two more months to workers and staff in the tourism sector.
Chhay Sivlin, president of the Cambodia Association of Travel Agents (CATA), welcomed the government’s decision, saying that it would help ease the burden on COVID-19-affected businesses.
“These measures will help contribute to saving costs for business which have been affected by the ongoing pandemic,” Sivlin said. “Before we thought the crisis would end this year but now we cannot predict the economic situation.”
Sivlin said that while some tourism-related businesses remained closed, the exemption will at least help businesses that remain open.
The exemption is on monthly tax, including the tax on revenue, tax on salary, tax on branding and the national social security fund (NSSF).
However, according to the announcement, the exemption is only offered for businesses operating in Phnom Penh, Siem Reap, Sihanoukville, Kep, Kampot, Bavet town and Poipet city. Sivlin said this is because these provinces are the country’s most popular tourist destinations and provide mixed services.
“We see the Ministry of Tourism has been encouraging a local travel bubble that would help a part of the sector and secure some jobs,” she said.
She said Siem Reap is now the target of the tourism ministry and tourism association to promote the travel bubble.
“More people prefer to travel to their nearest destinations such as Kep and Kampot province so we are now doing a drive for Siem Reap and we hope people will help this hardest-hit area,” she said
Thong Khon, Minister of Tourism, met with the private sector last week to develop a strategy to gradually receive international tourists.
He said the Ministry of Tourism has already drafted guidelines on travel by origin called a “Travel Bubble” or “One-way Closed-loop Chartered Plane”.
According to Khon, more than 3,000 tourism-based businesses have closed and caused more than 50,000 job losses in the sector because there are no international visitors.