Economists have hailed Cambodia’s move to introduce capital gains tax as a positive step in line with the national strategy to revive the economy in the wake of the Coronavirus Disease 2019 (COVID-19) pandemic and prevent a collapse of the real estate sector. However, those within the real estate business have expressed concern over the timing of the new tax regulations.
The General Department of Taxation on Aug. 27 announced that the government will begin implementing a 20 percent capital gains tax by early 2021, which will apply to all properties and other capital investments such as leasing, stocks and foreign currency.
Economist at the Royal Academy of Cambodia Ky Sereyvath argued that capital gains taxation will make a significant contribution to the economy, which is much needed as the COVID-19 pandemic continues to disrupt key industries such as garment manufacturing and tourism. Sereyvath noted that the addition of capital gains legislation will bring Cambodia’s tax regime closer to international standards, with many ASEAN and European countries charging a 30 percent tax rate on properties sold.