Council of Ministers has approved a new draft law on investment

Compass Cambodia report, July 12th - In a plenary session conducted on July 9th morning, the Council of Ministers approved the draft new investment law.

During the plenary session video conference, Samdech Prime Minister Hun Sen said the proposed law has a legal basis for attracting and facilitating additional investment in Cambodia.

This new investment law was drafted by a group of inter-ministerial agencies led by the Ministry of Economy and Finance to replace the present investment law, which was passed in 1994.

According to reports, the draft of the "New Investment Law" was unanimously accepted after the cabinet plenary meeting altered parts of the phrasing and content, and would be submitted to the National Assembly for consideration in the near future.

At the meeting, Prime Minister Hun Sen indicated that the "New Investment Law" will become a powerful weapon for attracting investors and will establish a favorable competitive environment, with a focus on protecting investors' rights and interests.

Following the meeting, Assistant Minister Pai Sipan stated that the government has had several consultations with representatives of the private sector and other stakeholders in order to obtain more detailed and comprehensive perspectives in the process of crafting the "New Investment Law."

According to him, the draft "New Investment Law" will effectively improve investment stability and predictability, as well as expand preferential measures based on current laws, boosting investor confidence and assisting in the attraction and promotion of domestic and foreign investors. Participate in the growth of Cambodian society and economy by making quality and effective investments in Cambodia.

According to reports, the draft of the "New Investment Law" is also flexible, and the yearly "Financial Management Law" might be passed under unanticipated circumstances to provide specific businesses or growing industries preferential treatment.

The draft "New Investment Law" aims to provide businesses with significant incentives and encourage them to create a better working environment for their employees, such as a VAT exemption for businesses purchasing locally produced materials for production inputs, and a special tax deduction of 150 percent for corporate research and development and innovation costs. Businesses can invest in new machinery and equipment for industrial upgrading, provide vocational training to employees, construct employee dorms, restaurants, and nurseries, and provide pleasant transportation, among other things. Concessions should be included in the new bill.

The most important issue is to make changes to the tax holiday time to make it more accommodating. The approved investment project (QIP) can enjoy a 3 to 9 year income tax vacation from the first income after the amendment. Approved investment projects can be taxed at a six-year progressive rate once the tax holiday period ends, and all imported products are exempt from all customs duties, including consumption tax and value-added tax.

In terms of operation, the draft draft makes extensive use of the "one-stop mechanism" to improve service and facilitate investment.

Source: Compass Cambodia comprehensive arrangement

Editor: Malinda         Chief Editor: Sunnie         General in Chief/Executive Producer: Nicole

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