Double tax deal to boost Chinese investment
Experts yesterday agreed that a double taxation agreement (DTA) with China due to come into force on January will boost Chinese investment in the Kingdom.
Speaking at a seminar in Phnom Penh, Clint O’Connell, head of tax at DFDL, said the agreement will attract more Chinese investors to Cambodia.
“It should encourage further Chinese investment in Cambodia. One of the main concerns of Chinese investors are the double taxation issues,” said Mr O’Connell.
Cambodia now levies withholding tax at the rate of 14 percent for the payments of dividends, interest and royalties to non-residents, but these are broadly reduced to 10 percent under a DTA.
Bun Neary, deputy director general of the General Department of Taxation, said Cambodia has signed DTAs with five nations: China, Brunei, Thailand, Singapore and Vietnam.
She said these agreements draw more investors to the country. This helps create jobs, which, in turn, increases government collection of income tax.
Chen Chang Jiang, chairman of the China Chamber of Commerce, said an increasing number of Chinese companies are turning to Cambodia for investment opportunities, attracted to the Kingdom’s rapidly expanding economy, stable political situation and good ties with the government in Beijing.
He said China continues to be the number investor country in Cambodia, adding that there are now 1,000 Chinese companies operating in the Kingdom.
“Chinese investors are investing almost in all fields, from energy to infrastructure and human capital,” he said.