The General Department of Taxation (GDT) is making it easier for property tax payments to increase from the country’s booming industry, according to Director-General of the GDT Kong Vibol.
Currently, tax payments such as on properties are made via GDT’s banking partners. However, taxpayers now have another option, which is simpler.
Vibol said the GDT’s officials are updating people’s property information into the tax system that would make it more convenient for taxpayers.
“[It means] you can pay property tax via an app developed by the GDT so that people can do so anytime and anywhere without going to a bank or payment agent,” he said. “The GDT is updating property data and information into the system.” Current taxation levels are applied to immovable properties valued more than 100,000,000 riels ($24,225) with tax collected annually at a rate of 0.1 percent of the property value.
The value of land, houses, buildings, and other constructions that are built on the land shall be determined based on the market price by the property evaluation committee which is established by directive of the Minister of Economy and Finance.
Cambodia’s property sector has been booming for years, boosted by the inflow of foreign direct investment (FDI) in real estate. However, according to a report by regional real estate company CBRE, as the COVID-19 pandemic continues to affect Cambodia’s real estate industry, the economic fallout from the second quarter (Q2) of the year’s disruption is yet to be fully realised. The report shows that real estate in Q2 2020 has been hit notably compared with Q1, with the effects shown in downward-adjusted rental rates and sale prices. Cambodia also saw a fall in the inflow of FDI in real estate.
According to the semi-annual report of the National Bank of Cambodia, FDI inflow into real estate fell 24 percent compared with last year, of which construction fell 8 percent.
The GDT is conducting deep reform to collect tax revenue and transforming traditional ways of digital-based platforms that eliminate unofficial fees.
The Cambodian government will also start to implement capital gains tax collection from next year to boost national revenue, which will apply to all properties and other capital investments such as leasing, stocks as well as foreign currency. For housing, the rate will be 20 percent of any profit from a sale.
The GDT collected approximately $1,684 million in tax revenue in the first half of this year, a 12 percent increase compared with the same period last year.