Cambodia's tax revenue increased 16 per cent in the first
half of this year compared to the corresponding period last year – a rise
economists have attributed to improvements in the Kingdom’s economy.
Critics, however, say it amounts to little compared to the
national gross domestic product (GDP).
Data from the Customs and Excise General Department shows
total tax revenue collected was US$454 million during the first half of 2012,
compared with $391 million in the corresponding period last year.
Son Chhay, a Sam Rainsy Party parliamentarian, has
criticised the tax-collection system, pointing to the high level of tax leakage
and losses.
“We all know that our GDP rose to nearly $15 billion. If we
compare that to our present tax collection, it is not equal to 11 per cent of
the GDP,’’ he said. “The leakage is still huge – that’s why some high-ranking
tax officials have become millionaires."
“They can simply use tax collection as a way to pad their
own pockets. Although it rose year-on-year, it does not reflect the real
payment or collection.”
Chan Sophal, president of the Cambodia Economic Association,
said the rise in revenue had come from tax-collection reforms that had made the
collection process more effective.
“I agree with raising our tax collection revenue, because it
goes hand in hand with the improvement of Cambodia’s economy – especially the
growth of imports,” Chan Sophal said.
He also said the increase in revenue was a result of the
increased flow of investment and raw material imports into the Kingdom as
Cambodian exports increased.
Hiroshi Suziki, CEO and chief economist of the Business
Research Institute for Cambodia, said that so far, the government, especially
the Ministry of Economy and Finance, had made big improvements in the
efficiency of tax collection.
It had been able to tackle the issue because of the Public
Financial Management Reform Program implemented in 2005 and supported by the
World Bank.
Olaf Unterroberdoerster, a senior economist for the
International Money Fund’s Asia and Pacific department, told The Phnom Penh
Post in April that Cambodia had a very low level of tax revenue compared to GDP
.
If it wanted to raise funds in a sustainable way for
development, investment and education, “it will be necessary to raise the
revenue performance of the government so that the expenditure can be financed,”
he said.
Chan Sophal said that despite the increase in tax revenue,
the government had to try to strengthen tax collection.
“It still has more room to raise revenue,” he said.
To contact the reporter on this story: May Kunmakara at
kunmakara.may@phnompenhpost.com
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