Cambodians passing on their property to relatives will no longer have to pay the requisite registration tax, the government announced on Sunday during the ruling CPP’s annual party congress.
The directive, signed by Prime Minister Hun Sen, was posted to both the the premier’s personal Facebook page and the website of the Finance Ministry’s general taxation department.
Transferred property is typically subject to a tax of 4 percent of its assessed value minus eligible exemptions. The directive states that transfers between spouses, parents and children, or grandparents and grandchildren, will no longer require this tax, effective immediately.
Officials at the Finance Ministry and the taxation department could not be reached for comment.
CPP spokesman Sok Eysan said the decision was made during the party congress to benefit all citizens, not just the wealthiest.
“It’s a very good policy that will benefit a lot of Cambodians,” he said. “The more than 15 million people who make up the population, including the rich and the poor, will benefit from it because both rich and poor have inheritance for their children and grandchildren.”
The government did not announce how much revenue it would be abandoning due to the new exemption. Development partners regularly urge the government to increase its tax revenue as a share of its gross domestic product in order to wean itself off of foreign aid and loans.
Pin Ratana, a civil servant living in Phnom Penh, welcomed the decision.
He said he had been unable to take ownership of an apartment from his father because he could not afford the tax, declining to specify the amount.
“I’m really happy to hear that Samdech Prime Minister decided to eliminate the registration tax for transferring property ownership because it will benefit everyone,” he said. “For many years, I could not afford to pay the registration tax to transfer an apartment in Phnom Penh’s Meanchey district from my father to me.”
In a separate post to his Facebook page on Sunday, Mr. Hun Sen also announced plans to lower electricity prices for the most modest users. As of April 2017, he said, those using 50 kilowatt-hours per month or less would be charged only 610 riel per kwh.