Cambodia Signs Double Taxation Agreement With The Phillipines
Cambodia and its ASEAN partner the Phillipines have finalised their double taxation agreement (DTA) after nearly five years of talks as the respective governments aim to improve trade and investment system mechanisms.
The agreement is likely to only be ratified at a ceremony in October 2024, a year in which the World Bank forecasts confirmed that the gross domestic product (GDP) in both Cambodia and the Philippines will expand by 5.8 per cent.
The Cambodian government has implemented various reforms to attract foreign investment. The special economic zones (SEZ), simplified procedures for business registration, and tax incentives for certain industries all offer opportunities for a range of businesses, while the General Department of Taxation (GDT) says the Cambodia Double Taxation Agreements (DTA) give confidence and certainty to foreign investors through various benefits.
The Philippines Finance Secretary Ralph Recto said; “Through this effort, we have not only complied with our commitment to completing the Southeast Asia DTA network but we have also ensured that the taxing rights of Filipinos here and abroad are equitably preserved and protected.”
The Cambodian delegation was led by Dr. Seng Cheaseth, Director of Law, Tax Policy, and International Tax Cooperation from the General Department of Taxation, Ministry of Economy and Finance of Cambodia. The Phillipines was represented by Department of Finance Revenue Operations Group Assistant Secretaries Gerald Alan A. Quebral and Dakila Elteen M. Napao, DOF Director Euvimil Nina R. Asuncion, BIR Deputy Commissioner Marissa O. Cabreros, Assistant Commissioner Larry M. Barcelo, and Atty. Robbie M. Bañaga.
As Cambodia seeks to open up international foreign direct investment and increase international competitiveness, it will likely pursue similar agreements with other suitable partners. Some of the benefits of the DTA include;
- Allows citizens of the two signed parties to avoid paying double tax in Cambodia and in their respective countries when they transfer money.
- Prevents or eliminates tax discrimination between local and foreign companies.
- Promotes the elimination of barriers to trade and investment and encourages cross-border economic activities.
Cambodia Double Taxation Agreements (DTA)
By the start of 2024, according to the General Department of Taxation (GDT), Cambodia had established DTAs with 11 countries and territories
These included Singapore, Thailand, Brunei, Vietnam, Indonesia, Malaysia, South Korea, Turkiye, mainland China and its special administrative regions of Hong Kong and Macau.
Cambodia and France initiated negotiations on a Double Taxation Agreement (DTA) in late 2023 when Cambodian Prime Minister Huna Manet made his first official visit to France which has strong historical ties to the country.
By April 2024, it was confirmed that the Kingdom was looking at potential DTA deals with six additional countries, which included the Philippines, Laos, Myanmar, Japan, Morocco, and the United Arab Emirates.