The Government of Cambodia has extended the suspension of Advance Profit Tax payment further by two years for the garment and footwear enterprises, as a move to support the industries.
The move has said to be made on approval from Cambodia’s Prime Minister Hun Sen, following a request from the Garment Manufacturers Association in Cambodia (GMAC) that observed cash flow issue in the Cambodian readymade garments industry. “GMAC made the request to our prime minister for the suspension on the minimum pre-payment of profit tax of 1 per cent, which is to be paid monthly. We see their difficulties so we are allowing them to pay annually now, extending the suspension [of monthly payments] until the end of 2017,” informed Kong Vibol, Director General of General Taxation Department (GDT).
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External Affairs Manager of GMAC, Kaing Monika expressed the burden that pre-paid profit tax payment laid on the RMG industry of the country, “[The monthly tax] is a big burden for cash flow in the garment and footwear factories. That’s why we made the request to the Government for the suspension. The pre-paid tax is really affecting cash flow of factories. In other countries profit tax is paid at the end of the year… In contrast, in our country, we need to pre pay profit tax of 1 per cent of our turnover, monthly.” The Government has extended the suspension on prepaid profit tax for the third time.
