Cambodia's Ministry of Economy and Finance has confirmed the extension of preferential tax incentives for agricultural enterprises through the end of 2027, continuing measures already in place for 2025. The policy is intended to support agricultural production and maintain operating conditions for local businesses.
According to the ministry's announcement of November 25, the measures include suspension of minimum tax payments, income tax exemptions, and removal of withholding obligations for payments made to non-self-declared service providers. The incentives apply to enterprises involved in the cultivation, production, domestic supply, or export of a wide range of crops and livestock. Eligible products include corn, beans, peppers, cassava, cashew nuts, mangoes, and bananas.
Value-added tax on agricultural goods is treated as a state burden. Farmers and agricultural enterprises selling or exporting agricultural products are not required to pay VAT on these goods and can claim VAT credits for materials used in production. VAT is also not applied to the sale of agricultural products within Cambodia.
Lun Yeng, Secretary General of the Cambodia Rice Federation, told Kiripost that the government has provided preferential tax treatment to the agricultural sector since 2011 and noted that more than 200 federation members have accessed the incentives. A member from Battambang province, the owner of Jing Mii rice miller, reported receiving relief since 2022 and said he plans to reapply. He stated, "The incentive has eased my concerns about declining paddy prices, as it eliminates the burden of additional taxes such as income tax. I can redirect funds that would have gone to taxes to support mill operations. When a business can reduce expenses, it can increase its raw material purchases and stay competitive in the market."
Yeng advised agricultural operators to ensure they complete the required documentation to qualify for the scheme. Requirements include obtaining a VAT certificate under the state burden system from the General Department of Taxation, attaching a supplier list to monthly VAT submissions, maintaining accounting records, and submitting monthly tax filings to the Tax Administration.
Source: KiriPost
