Hun Sen Says Civil Servants to Get Tax Break

Prime Minister Hun Sen said on Thursday that civil servants making less than 800,000 riel, or about $200, a month will be exempt from paying income taxes, just days after the Finance Ministry sent a very different message to the country’s garment workers.

“No tax will be imposed on [civil servants] receiving under 800,000 riel,” Mr. Hun Sen said at a graduation ceremony on Koh Pich island. “With this, the state will subsidize and lose $10 million in revenue, but that’s only a little.”

The prime minister’s announcement comes about a week after Kong Vibol, the director-general of the Finance Ministry’s tax department, told union leaders that their members—due for a raise to their $100 minimum wage in January—should prepare to pay a 5 percent income tax if they end up making more than 500,000 riel, or about $125, a month.

Mr. Vibol cited the 1997 taxation law, which requires salaried employees making more than 500,000 riel to pay a portion of their monthly earnings in tax.

Ros Phearun, spokesman for the Finance Ministry, could not be reached for comment Thursday.

Chea Mony, president of the Free Trade Union, warned his union would stage protests if the government doesn’t impose income taxes equally.

“This is not right because civil servants have more holidays than company staff and workers,” he said. “I am waiting and observing whether civil servants earning 500,000 riel don’t need to pay income tax or not.”

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