On 23 December, the Royal Government of Cambodia announced the 7th round of additional measures to (1) Continue to introduce and implement business stabilization measures as Cambodia continues to face the COVID-19 crisis as well as support and rehabilitate businesses in post-COVID-19 Support, (2) Continue to support the daily lives of poor and vulnerable families through the “Pandemic Relief Fund”. The 7th round additional measures have prepared with the discussion between related parties as follow:
- The measure to continue to support Garments, textiles, footwear, travel products, bags, and tourism
- For the garment sector, this additional measure will continue to provide a stipend of $ 40 per month to workers who works at Garments, textiles, footwear, travel products sector. This program will continue for another 3 months from January to March 2021. The factory owner has to add $ 30 to this $ 40 so that the workers can get $ 70 per month.
- For tourism workers, including hotels, guesthouses, restaurants, and travel agents, they will receive $ 40 for the same three months, but Enterprise owners shall participate voluntarily in addition to the government support.
- The government also extends the tax exemption for another three months from January to March 2021 for registered hotels, guesthouses, restaurants, and tourism agencies. This exemption applies to tourism businesses in Siem Reap, Phnom Penh, Kampot, Sihanoukville, Kep, Bavet and Poipet. These enterprises still has the obligation to submit the tax announcement and using E-VAT during this exemption period.
- The government also postponed the payment of social security obligations on pensions, exempting patent and nominal taxes, and postponing the audit for the year 2020 from the General Department of Taxation for travel agencies and operators in the tourism sector.
- Continue to extend the implementation of the social security system for pensions for another 6 months, until July 2021. The delay is based on a continuous assessment of the actual socio-economic situation.
- Continue to exempt the payment of social security contributions for occupational risk and health care of the National Social Security Fund during the suspension or suspension of business operations.
- Continue to exempt the payment of patent tax and tax stamp duty (trademark tax) to other travel agencies and operators in the tourism sector. These taxpayers are obliged to update patents.
- Taxpayers in the tourism sector such as hotels, guesthouses, restaurants and travel agencies registered with GDT and have business activities in Phnom Penh, Siem Reap, Sihanoukville, Kep, Kampot, Bavet and Poipet are obliged to apply for income tax return for 2020 at the latest before the end of March 2021, but do not have to pay any taxes.
- The measure to support Aviation
- The government will also extend for three months of tax exemption on the “Minimum Tax” for Cambodian-registered tour operators from January to March 2021.
- Continue to extend the payment of civil aviation fees for an additional three months from January until March 2021, with the permission of the airlines to arrange for the payment of such debts in stages after this extension.
- Measures to help factories, enterprises and businesses, as well as to facilitate the lives of the employees
- Continue to allow factories, enterprises and businesses in all sectors to postpone the payment of seniority remuneration before 2019 and the payment of seniority payment for 2020 2021 to 2022.
- Growth support measures
- Continues stamp duty exemption for home purchases worth no more than $ 70,000 until December 2021
- Ease of implementation of withholding tax on local and foreign lenders
- For new loans
- Reduce the withholding tax rate on loans from banks and microfinance institutions, both domestic and external (DTA and non-DTA), to 5% for 2021.
- Reduce the withholding tax rate on loans from banks and microfinance institutions, both domestic and foreign (DTA and non-DTA), to 10% for 2022.
- Examine and adjust the withholding tax rate on loans of banks and microfinance institutions, both external and domestic, to the normal level in accordance with the laws and regulations by 2023.
- For old loans
- Reduce the withholding tax rate on loans from banks and microfinance institutions, both domestic and external (DTA and non-DTA), to 10% for 2021.
- Examine and adjust the withholding tax rate on loans of banks and microfinance institutions, both external and domestic, to the normal level in accordance with the laws and regulations by 2022.
- For new loans
- Relief fund for poor and vulnerable families
- Poor and vulnerable families will continue to receive benefits for the next three months, from January to March 2021.
“The Royal Government will continue to monitor the situation of COVID-19, the economic and financial situation in the regional framework and Global to examine and evaluate the impact of COVID-19 on key sectors of the Cambodian economy in the direction of updating the necessary measures that are launched and ready to launch new measures under the framework of the economic recovery strategy after the COVID-19 crisis.
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