Korea-Cambodia Double Taxation Avoidance Agreement Officially Enters into Force on the 29th

[Asia Economy Reporter Yoo In-ho] The double taxation avoidance agreement between Korea and Cambodia, signed in 2019, officially came into effect on the 29th.

The Ministry of Foreign Affairs announced that, following the completion of domestic procedures with the National Assembly's ratification on December 9 last year, from this day forward, all tax treaties concluded with the 10 ASEAN (Association of Southeast Asian Nations) countries will be in effect.

With the enforcement of the agreement between the two countries, only income attributable to local permanent establishments such as factories or offices can be taxed. Until now, taxation was applied regardless of the presence of such establishments.

Additionally, the tax rate applied to dividend, interest, and royalty income is capped at a maximum of 10%, which is lower than the previous maximum rate of 14%.

The Ministry of Foreign Affairs stated, "This treaty is expected to further activate economic exchanges such as investment between Korea and Cambodia."

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