Royal Government Continues and Increases Tax Incentives for Real Estate Sector

The royal government of Cambodia has decided to extend the preferential policy of exempting residential property transactions with a price below or equal to US$70,000 from 4% stamp duty (registration tax) until December 31, 2025.

This important measure aims to stimulate the recovery and development of the real estate industry and help the troubled market out of its difficulties.

According to a notice issued by the Ministry of Economy and Finance on the 9th, Prime Minister Hun Manet approved on September 26 the extension of a number of tax incentives in the real estate sector.

Since 2020, Cambodia's real estate market has been impacted by multiple factors, especially the economic recession caused by the epidemic and the subsequent high loan interest rates, which have put many real estate developers and buyers under great pressure. In this case, the government's tax incentives are particularly important and have injected vitality into the market.

The government has also decided to delay the implementation of capital gains tax until the end of 2025, the ministry noted.

The capital gains tax was originally scheduled to be levied on January 1, 2021, but the policy has been postponed several times due to poor market conditions. Under current regulations, capital gains tax applies to asset transactions of individuals and companies, including real estate, asset leasing, and investment. However, government and foreign embassy properties, as well as personal residences that meet certain conditions, can still enjoy tax exemption.