Chapter XVIII

Chapter XVIII:

TAXATION

Most of the investments and foreign investors in Cambodia will be affected by the following taxes:

b Profit Tax :	0% to 20%
b Minimum Tax :	1% on gross income earned for year
b General Value Added Tax :	10%
b Turnover Tax :	from 1% to 10%
b Import Tax :	7%, 15%, 20%, 35% or 50%. Import Duties are levied on a wide range of products.
b SalaryTaxofNon Residents :	15%
b Fringe Benefit Tax :	20%
b Withholding Tax :	5% to 15%

b Specific Tax on Certain Goods and Services.

* Profit Tax:

Profit Tax rates differ completely depending on the type of business activities undertaken by the concerned enterprises:

1- Approved Investment Enterprise 0% or 9%

2- Insurance 5%

3- National Resources 30%

4- General 20%

* Turnover Tax:

Turnover Tax is a tax on gross turnover received. The rates vary depending on the following business activities:

1- Importation goods 4%

2- Industrial, handicraft or mining 1%

3- Hotel rooms, services, nightclub and restaurant 10%

4- Other 4%

* Special Tax:

Item	Rate
Most automobiles and parts-displacement > 2000cc	30%
Most automobiles and parts-displacement<2001cc	20%
Most large automobiles (e.g. buses, trucks)	10%
Motorcycles-displacement > 124cc	10%
Certain petroleum products	20%
Certain carbonated and similar non-alcoholic drinks.	10%
Beer, Wines and most other alcoholic beverages	10%
Cigarettes and cigars	10%
Hotel accommodation and entertainment charges	10%
International air tickets-commencing in Cambodia	2%
Certain international telecommunications activities	2%

* Withholding Tax:

Withholding Tax includes resident withholding tax, non-resident withholding tax and dividend withholding tax Resident withholding tax is as follow:

Net Dividend * Profit Tax Rate

(100 – Profit Tax Rate)

1- On interest payment on saving account 5%

2- Services of physical person 15%

3- Royalties for intangible assets 15%

4- Income from rental 10%

* Non-Resident Withholding Tax:

Non-Resident Withholding Tax is required to be deducted on payment of Cambodian source income to a Non-Tax Resident at a rate 15%.

* Dividend Withholding Tax:

Dividend Withholding Tax is imposed on dividend distributed to domestic or foreign shareholders at a percentage equal to the profit tax rate of the enterprise as per formula.

Based on the foregoing incentive requirements, it is now the right time to invest in Cambodia. Our group, KT PACIFIC GROUP COMPANY LIMITED., warmly welcomes the local and foreign investors to cordially cooperate with us to promote and develop our country.

KT PACIFIC GROUP LIMITED

#43, Street Preah Monireth, District

Veal Vong, Precinct 7 Makara,

Phnom Penh, Cambodia.

Tel : (855-23) 427 959

Fax : (855-23) 426 723

E-mail: ktpacific@camnet.com.net

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