Govt suspends tax prepayment for agricultural sector

The Ministry of Economy and Finance issued a prakas last week, suspending prepayment of tax on profits for companies dealing the production, supply or export of agricultural products such as paddy rice, milled rice, corn, beans, pepper, cashew nuts, cassava and rubber. The exemption is valid for the next five years, starting this month, according to the prakas. The sub-decree on tax incentives for small- and medium-sized enterprises in priority sectors, signed by Prime Minister Hun Sen on October 2, identified six priority sectors. These include the agro-industry and food production and processing, which will receive an income tax exemption for three to five years from the date of tax registration for newly registered enterprises, or from the date of tax registration updates for enterprises already registered. Cambodia Chamber of Commerce vice-president Lim Heng said the decision was intended in part to entice investors. The suspension of prepayment of tax on profit will help ease the burden of enterprises that do not earn profit as they do not have to prepay 1% as they did before, he explained. (Source: Phnom Penh Post)