Cambodian Customs Revenue Up Despite ASEAN Trade Tax Losses

An increase in Cambodia's annual customs revenues has been reported even though $150 million was lost in tax last year due to the ASEAN Free Trade Agreement (AFTA), which sees tariffs dropped on goods originating within the 10-member economic bloc, according to General Department of Customs and Excise (GDCE) general director Kun Nhem. 

“Despite losing 56 percent more revenue last year to tariff concessions under AFTA, we still managed to increase overall customs revenue,” said Nhem, who noted that ASEAN’s Common Effective Preferential Tariff scheme was forcing the government to adopt more efficient customs collection procedures and develop alternative sources of tax revenue. Following their annual closed-door meeting yesterday, the GDCE reported a 10 percent rise in customs and excise revenue compared to the previous year, collecting a total of $1.74 billion in 2016. 

Improved customs control systems and better enforcement, as well as a successful crackdown on smuggled goods, were attributed to this increase according to Nhem. A higher “specific tax” on certain products such as luxury goods, automobiles and cigarettes that went into effect last April, helped revenue grow on revised excise taxes. Cambodia joined the AFTA agreement – commits signatories to phase out tariffs on the imports of virtually all products originating within ASEAN – in 1999, but was granted an extended timeframe to implement it and given exemptions on certain products. 

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