PHNOM PENH: The Royal Government of Cambodia has introduced new measures to support the construction and development of Boreys (gated housing communities) to maintain the stability of the real estate sector. This sector is considered a priority to supporting overall economic growth by maintaining job sustainability and empowering low- and middle-income families with affordable housing solutions.
A press release issued by the Economic and Financial Policy Committee on Monday, 17 April 2023, states that the Royal Government has decided to introduce additional measures, such as extending the implementation of package tax payments in stages until the end of 2024 for Borey developers. This applies to companies that have been operating housing development projects with an official real estate business license provided by a real estate and mortgage regulator.
Those companies which have been operating Borey development projects without real estate business licenses must hurry to register their projects no later than in 2023, in order to receive the package tax payment benefit until the end of 2024.
The package tax payment period is being increased from 12 months to 18 months for Borey housing developers who pay less than US $1 million in taxes, while housing developers who pay taxes exceeding US $1 million will see the payment period increased to 36 months from 24 months.
The press release also reminds that all companies helping to develop new Borey projects or companies which plan to develop new housing projects must pay taxes in accordance with the procedures in force and must maintain proper accounting records.
The Royal Government will postpone the collection of taxes only for the real estate sector until the end of 2024, and will continue to exempt the need for official stamped documentation when transferring ownership or occupancy of all forms of housing under or equal to US $70,000 until the end of 2024.
The Royal Government encourages and requests banking and financial institutions to restructure their loans according to the capabilities shown by the business, based on a principle of volunteering and on a specific agreement made between the financial institution and the housing development company. This includes waiving any fines for Borey housing development projects, while the developer must continue to fulfill its obligations in accordance with the announcement made on "Real Estate Development Business Management".
Although Cambodia's socio-economic activities have been gradually returning to a normal course, a high level of uncertainty in the global economic and financial situation still remains, as in other countries. This includes concerns over a national slow-down of economic growth, the rising tensions between Russia and Ukraine, the longer-than-expected tightening of monetary policy in this region, the continued disruption of the global supply chain and overall increasing tensions in the global financial sector.
