Authorities have started a tax sweep and are inspecting enterprises in Phnom Penh as part of efforts to increase collections for the government.
According to an announcement by the General Department of Taxation (GDP) dated July 19 and obtained by Kiripost on Thursday, the objectives of the inspection, which began on July 25, are to provide an easier registration service process and collect information about enterprises, owners and business activities.
The objectives, according to the announcement, which was signed by Director General Kong Vibol, is also to improve Cambodia’s investment climate, promote fair business competitiveness and strengthen the compliance of paying taxes voluntarily.
GDP informed enterprises to have all documents in order for the inspection, including the latest patent certificate, registration certificate, taxation registration or tax receipts.
For unregistered enterprises, documents should be produced, such as national identification cards or the passports of owners or representatives, and letters of business registrations with department and ministry.
Pech Pisey, Executive Director at Transparency International Cambodia, said the GDP inspection is necessary to make companies comply with laws and it will increase revenue in the national budgets.
However, Pisey added the inspection will be risky for some small size and informal businesses that have been financially hit by the Covid-19 pandemic. He urged the tax requirements are equally enforced with big companies.
“As we already know, in this context, enterprises, especially small ones, have been affected by Covid during the last two years and the return of business recovery hasn't really come back yet,” Pisey told Kiripost.
“Now, we have the crisis of war in Ukraine and I am worried that harsh tax compliance will make enterprises bankrupt, may affect small businesses which drives the economy and affect job opportunities.”