Real estate transfer taxes contribute significantly to H1 revenue

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Stamp duty on real estate transfers contributed the most to the total tax revenue of the General Directorate of Taxes (GDT) in the first half of this year, according to a press release from the GDT of the Ministry of Economy and Development. Finance (MEF).

Real estate transfer stamp duty – a category of tax paid when real estate is acquired in various forms, including sale and purchase, exchange, gift or inheritance – contributed approximately $875 million or 44.38% of total tax revenue of approximately $1.2 billion in the first six months of 2022.

Khun Darith, managing partner of accounting and tax solutions at accounting firm K Professional Accounts (KPA), said Khmer time that transfers of immovable property could be made with hard or soft titles and that stamp duty on transfers is generally paid at four percent of the price of the immovable property specified in the tax authorities’ list.

“The contribution of stamp duty on transfers of real estate reflects that there can be many real estate sale-purchase transactions,” Darith said, adding that the exception for the payment of the tax is for l acquisition between blood family members such as parental transfers. to children.

However, the accountant and tax expert said there does not seem to be much real estate sale-purchase transactions in the real estate market as the economy has not yet recovered well.

“There may have been a small number of transactions or transfers in the market, but the value of the real estate assets that have been transferred by sale-purchase is enormous. For example, ownership of a borey is transferred. So even if the number of transactions is small, the value of the asset is significant,” explained Darith.

Chrek Soknim, president of the Cambodian Real Estate Appraisers and Agents Association (CVEA), said Khmer time this smaller value of many transactions was mainly observed in peripheral areas, resulting in low tax collection, which is different from central cities where there are fewer transactions, but the value is much larger, in especially those properties in Beung Keng Kang Region.

“It may also be that transfers have been made for large projects that require many exchange transactions. So I think the numbers reflect the reality of the real estate market as we have seen that boreys and condominiums have been sold and bought normally in the center and periphery,” said Sokniim, adding that property sales of 20,000 $ or $30,000 have yet been made. .

“Sales of land and houses in the city and areas outside the city have continued. This means that the development potential is still high. So the numbers really reflect reality,” said Soknim, who is also CEO of property company Mekong Brokerage Co., Ltd.

Following the stamp duty on real estate transfers, the special tax and the value added tax (VAT) accounted for 34.01% and 33.37% respectively of the total tax revenue in the first half of this year, while that 27.19% corresponds to income tax. , 25.16% by income tax and 10.12% by property rental tax.

Tax revenue rose 30% to $452.74 million in the first half of this year compared to the same period in 2021.

MEF Minister Aun Pornmoniroth said GDT will pursue the Real Estate Identity (Property ID) mechanism to certify that every owner pays taxes and avoid selling properties without paying taxes.

“Continue to provide property tax services to the public by making it easy to prepare the property tax bill for each property and deliver it directly to property owners at their addresses,” Pornmoniroth said.

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