HK, Cambodia sign tax pact

June 26, 2019

Hong Kong and Cambodia today signed a comprehensive avoidance of double taxation agreement.


The agreement sets out the allocation of taxing rights between the two jurisdictions, which will help investors better assess their potential tax liabilities from cross-border economic activities.


Under it, any tax paid in Cambodia by Hong Kong companies will be allowed as a credit against the tax payable in Hong Kong on the same income, subject to the provisions of Hong Kong tax laws.


For Cambodian companies, the tax they pay in Hong Kong will be allowed as a deduction from the tax payable on the same income in Cambodia.


The agreement also provides several tax relief arrangements and has incorporated an article on exchange of information which enables Hong Kong to fulfil its international obligations on enhancing tax transparency and combating tax evasion.


Secretary for Financial Services & the Treasury James Lau, who signed the agreement on behalf of the city, said Cambodia was Hong Kong's 38th largest trading partner in 2018.


“We have all along treasured our economic and trade ties with Cambodia and I have every confidence that this agreement will encourage more bilateral investments and bring our co-operation to a new level.”


The agreement will come into force after the completion of ratification procedures by both sides.


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