The agreement that Cambodia signed on double-taxation avoidance (DTA) with Malaysia on Sept 3, 2019, during the visit of Malaysian Prime Minister Tun Dr Mahathir Mohamad to Phnom Penh has been finally ratified by Malaysia.
Under the DTA, double taxation will be avoided in that any tax paid in Cambodia by Malaysian companies in accordance with the DTA will be allowed as a credit against the tax payable in Malaysia on the same income, subject to the provisions of the tax laws of Malaysia. Likewise, for Cambodian companies, the tax paid in Malaysia will be allowed as a deduction from the tax payable on the same income in Cambodia.
The double-taxation avoidance agreement will further strengthen bilateral trade ties between Malaysia and Cambodia.
Malaysian Ambassador to Cambodia Eldeen Husaini Mohd Hashim said the agreement will boost investment and trade between the two countries.
“We have waited so long for the agreement. Cambodia is the last of the Asean member countries to sign the DTA with Malaysia. It was signed in September 2019 and is now ratified so it is all systems go to get this implemented,” the ambassador said.
He added that the imposition of double taxation has deterred some Malaysian investors from coming to Cambodia. With the DTA now ratified, more Malaysian companies are expected to explore business and investment opportunities Cambodia.
According to Malaysian authorities, the ratification of the DTA is a milestone achieved by both sides.
“The Malaysian government has finally completed its constitutional procedures for the ratification of the double-taxation agreement. This ratification will enable the agreement to come into force, thus enabling both sides to implement it accordingly.”
Ambassador Eldeen added that he believes in a mantra of “a positive attitude leads to a positive action”.
“What we have achieved during then Prime Minister Tun Dr Mahathir’s official visit last year when we inked the DTA is an effort of great teamwork from the embassy down to every Malaysian here in Cambodia. I am delighted to note that it has happened during my time as ambassador here in Cambodia. This a win-win for both sides and will definitely boost the bilateral relations for Malaysia and Cambodia,” he said.
Cambodia is Malaysia’s eighth-largest trading partner in Asean and the 50th in the world. Cambodia has entered into double-taxation agreements with Brunei, China, Indonesia, Malaysia, Singapore, South Korea, Thailand and Vietnam.
This article was first published in Khmer Times. All contents and images are copyright to their respective owners and sources.