The Ministry of Economic and Finance (MEF) announced, dated on 10 May 2024 on Cambodia’s new income tax incentive for the Qualified Investment Expansion Project (QIP).

This Prakas aims to introduce the implementation of income tax incentives for the expansion of Qualified Investment Projects (QIPs). More specifically, Prakas No. 313 ANKR.BK, adds conditions for tax exempt previously defined under Sub-Decree No. 139 ANKR.BK, released in June 2023.

This initiative aims to stimulate economic growth by offering income tax exemptions to QIPs that plans to expand their operations within Cambodia. The type of business expansions able to gain income tax exemption include QIPs that are engaged in activities such as expanding existing production, diversifying product lines, adopting new technologies that enhance productivity, and other approved expansion activities.

According to the Prakas the General Department of Taxation will issue a certificate on income tax exemption for the expansion of the QIP to ensure that, the enterprise has fulfilled tax obligations properly, in accordance with the national laws and regulations governing taxation.

By reducing the tax burden on expanding enterprises, Cambodia aims to create a more attractive environment for investment, promoting sustainable economic development. This initiative represents a significant step toward encouraging strategic investments and sustainable economic development.