The government decided to drop a 10 percent value added-tax (VAT) for rice products during a meeting on Wednesday between representatives of the rice sector and government officials at the Council for the Development of Cambodia in Phnom Penh, officials said.
Sok Puthyvuth, president of the Cambodia Rice Federation (CRF), said after the three-hour meeting that Deputy Prime Minister Keat Chhon had agreed to waive the tax, which is incurred mainly by millers.
“The government will waive the VAT, which will be helpful because rice millers will not need to pay this tax,” said Mr. Puthyvuth.
Moul Sarith, secretary-general of the CRF, said the move would help millers and farmers by lowering production costs.
Sam Arth Veasna, vice president of Federation of Cambodian Rice Farmer Organizations for Development, welcomed the government’s decision.
“Even though it is not a big offer, I think it would make farmers and rice millers feel better,” he said. “However, I cannot assess how much better.”
Millers have been at the fore of recent campaigns for the government to take extraordinary measures to boost the rice sector, mainly by increasing access to credit.