Prime Minister Hun Sen announced yesterday that all registered hotels and guesthouses in Siem Reap will be exempt of all taxes from February until May this year.
The measurement is to facilitate businesses that are losing visitors because of the Novel Coronavirus, also known as Covid-19, which has seriously damageded the tourism sector in Siem Reap.
During a special message regarding the latest situation at the Peace Palace in Phnom Penh yesterday, Mr Hun Sen said that Covid-19 is another challenge among the existing problems facing the world, including the trade war and global economic slowdown.
He said that the impact of Covid-19 has come faster than expected and has caused a serious effect on the economy in Asia, pushing some countries into crisis.
“Like other countries, Covid-19 has also affected some important sectors of Cambodia. Two sectors that have been seriously affected is first the tourism sector because tourists are afraid of travelling and also face some flight cancellations. Second is the garment sector which is now lacking raw materials for processing,” the prime minister said.
He added that Covid-19 has caused a serious effect on the tourism sector in Cambodia with foreign tourists coming to Cambodia this month falling about 60 percent and Chinese tourists in particular declining by 90 percent.
“At present, we will focus on helping the tourism business in Siem Reap. The measure is set to help hotels and guesthouses continue their operations and maintain jobs and competitiveness,” he said.
“The government will exempt all kinds of taxes on hotels and guesthouses that have registered with the tax department in Siem Reap. However, from February to May, hotels and guesthouse businesses will still have to submit tax declarations and use the online system for monthly value-added tax for assessment during the exemption period,” Mr Hun Sen said.
The premier said the government will shoulder all tax payments during this exemption period, clarifying that it will only cover Siem Reap province and not the entire Kingdom.
Mr Hun Sen said that the government will also urge workshops, seminars, short training courses and other events organised by government bodies, the private sector and nongovernmental organisations to host their events in Siem Reap and Sihanoukville.
“The government urges outbound tourists to think of visiting local tourism sites and asked hospitality and service providers to reduce hotel and guesthouse fees,” Mr Hun Sen added.
Thourn Sinan, chairman of the Pacific Asia Travel Association Cambodia Chapter, welcomed the move, saying, the private sector has supported the government’s new measure.
“However, we also call on the government to exempt the taxes on tour agents and travel companies because the tour companies are also facing issues both inbound and outbound,” Thourn said.
He added that these hotels and guesthouses have only received tax exemptions for a short period. However this will not be a long-term exemption, so all hotels and guesthouses must contribute more to promote destinations to tourists.
“A lot of hotels and guesthouses are sitting and waiting to get results and then make a complaint when they do want to put much effort into promoting the tourism destinations they are in,” he added.