Cambodia: VAT and e-commerce transactions

The framework regarding the value added tax (VAT) treatment of goods and services supplied via electronic commerce

The framework regarding VAT treatment of goods and services supplied via e-commerce

Sub-Decree no. 65 SD.Prk (8 April 2021) provides the framework regarding the value added tax (VAT) treatment of goods and services supplied via electronic commerce. Detailed procedures to implement the VAT rules on e-commerce transactions are to be set forth by future guidance (a Prakas) to be issued by the Ministry of Economy and Finance.


The sub-decree defines certain terms such as:

  • “Digital goods” are defined as intangible goods purchased, supplied, and provided entirely online.
  • “Digital service” is defined as services performed online.
  • The term “e-commerce” refers to the purchase, sale, rental or exchange of goods or services, including commercial activity online.

The sub-decree provides a detailed list of e-commerce transactions subject to these rules including:

  • The supply of software and other related services
  • Online shopping or auctions
  • Advertising
  • Website hosting
  • Data retrieval
  • Consumption of digital products and/or contents via download, real-time streaming, subscription, or other means

Non-residents involved in e-commerce transactions

Non-resident taxpayers conducting e-commerce transactions in Cambodia but with no permanent establishment in Cambodia are required to register with the General Department of Taxation, based on a taxpayer classification under the self-assessment regime, as determined by Ministry of the Economy and Finance. This registration requirement is for VAT purposes only.

For business-to-consumers (B2C) e-commerce transactions, the non-resident taxpayer must declare and pay for the VAT regarding the transaction.

For business-to-business (B2B) e-commerce transactions, the amount of VAT on the transaction must be accounted for, by means of the “reverse charge” mechanism. Under the “reverse charge” mechanism, the resident taxpayer receiving the supply from the non-resident taxpayer is to account and pay for the output VAT regarding the supply on behalf of the non-resident taxpayer. Correspondingly, input VAT shall be allowed as the amount of input VAT is to be allowed as a tax credit, pursuant to the current rules.

Read an April 2021 report [PDF 159 KB] prepared by the KPMG member firm in Cambodia

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