The Ministry of Economy and Finance has issued a prakas introducing new rules and procedures governing value added tax (VAT) on goods and services provided through e-commerce.
The new legislation, dated September 8, mainly targets e-commerce transactions between Cambodian tax-paying consumers and sellers active in Cambodian territory who are non-residents and do not have a permanent establishment in the Kingdom.
The assessed value of a supply is the value of the transaction, the prakas said, adding that any form of non-cash compensation arrangement should be included in the value, based on market rates.
If the taxable value of the digital goods or services provided does not represent the actual value, the tax administration may determine one, which will be deemed valid until there is evidence accepted by the tax administration, adds the document.
The prakas complements Sub-Decree No. 65 of April 8, which regulates VAT on goods and services supplied electronically, and is designed in accordance with the Law on Electronic Commerce, which entered into force in November 2019.
The government recently launched a 15-year policy framework for the Kingdom’s changing digital socio-economic environment to pave the way for a thriving digital economy, as a new engine of economic growth.
Quoted in a related document, Economy and Finance Minister Aun Pornmoniroth said that Cambodia’s Digital Economy and Social Policy Framework 2021-2035 sets out a vision to “build a vibrant digital economy and society to foster new economic growth and promote social welfare based on the normalization of the “new normal” ”.
He stressed that the vision must be realized by 2035, in accordance with three principles – “building a digital foundation”, “digital capture” and “digital transformation”.
“In the context of the Covid-19 crisis, the Cambodia Digital Economy and Social Policy Framework 2021-2035 will be an integral part of the post-Covid-19 economic recovery planning framework, covering the construction of infrastructure digital, attracting countries and foreigners. investing, promoting new start-ups, increasing productivity and promoting economic competitiveness, ”Pornmoniroth said.