Government To Drop VAT On Agricultural Exports

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Local firms will no longer be charged value-added tax (VAT) on exports of agricultural goods, Prime Minister Hun Sen announced Friday.

A Cambodian rice miller inspecting rice that will be exported. KT/Chor Sokunthea

The premier said dropping VAT charges on exports of agricultural products – including milled rice, corn, cassava, and pepper – will enhance the competitiveness of the agriculture and export sectors.

Mr Hun Sen announced the decision during Friday’s Government-Private Sector Forum.

Following discussions with representatives of private companies on the most pressing issues faced by the private sector, the premier said the Ministry of Economy and Finance will no longer levy the tax.

Mr Hun Sen, who chaired the forum, said this will help local companies, adding that growth in the agriculture sector has slowed down in recent years while production costs have changed unpredictably.

“From now until 2023, the government will assume VAT costs on the export of paddy rice, milled rice, corn, beans, pepper, cassava, cashew nuts, and rubber,” Mr Hun Sen said at the forum.

The move comes amid a series of reforms to make exports more competitive, including the removal of Camcontrol personnel from border checkpoints and the dissolution of the Kampuchea Shipping Agency and Brokers, also known as Kamsab.

This article was originally published in the Khmer Times.