Non-Taxable Supplies - VAT update

On 25 May 2017, GDT issued Prakas 559 to clarify non-taxable supplies for VAT purpose.

The aim of Prakas is to list down non-taxable supplies as well as to provide certain relevant definitions following the amendment in the 2017 Law on Financial Management.

Previously, primary financial services are defined clear. Prakas 559 provides clear definition:

a. Transactions of taking deposits, providing loans or lending excluding service fees related to the provision of
loans or lending;
b. Issuance of securities in the primary market, trading of securities or other financial instruments, and clearing
and settlement services within the Cambodia Securities Exchange;
c. Foreign exchange services;
d. Pawn brokerage services; and
e. Trading of gold that has not been processed as jewellery.

Prakas 559 list down non taxable supplies as followed:

1. Public postal service;
2. Hospital, clinic, medical and dental services and the sale of medical and dental goods incidental to the
performance of such services;
3. Services of transportation of passengers by a wholly state owned public transportation system;
4. Insurance services;
5. Primary financial services;
6. Importation of articles for personal use that exempt from custom duties;
7. Non-profit activities in the public interest;
8. Educational services;
9. Electricity and clean water;
10. Unprocessed agricultural products; and
11. Services relating to the collection or removal of waste material either solid or liquid

Advance Grand Formula Co., Ltd is a Cambodian tax agent under license number – TA202204002.

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