Asean Will Mean More Tax, Finance Minister Concludes

Finance Minister Keat Chhon said Tuesday that Cambodia will have to increase internal taxes to offset a drop in customs revenues when it joins Asean.

“Our custom duties are to be reduced, so the internal taxes will be increased,” he told reporters outside the National Assembly.

At the summit of Asean nations last week in Hanoi, the nine member nations agreed to admit Cambodia, but did not set a date for the ceremony. The unfinished business of creating a Senate in the new government coalition was the main sticking point.

As a member, Cambodia will have to join the Asean Free Trade Area, which when created will mandate the reduction and eventual elimination of tariffs on goods being traded be­tween Asean member countries. Cus­toms revenues ac­count for roughly half of Cam­bo­dia’s revenues.

The Finance Minister hailed Cambodia’s imminent admission to Asean, but cautioned there will be a price to pay.

“We have to pay $5 million a year and it will be reduced to $1 million a year…later,” he said. “But what we get in exchange is the national security of our country.”

Cambodia must pay fees to support the Asean Secretariat and will incur other expenses to maintain membership.


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