By KER MUNTHIT
Associated Press Writer
PHNOM PENH, Cambodia — Businesses in Cambodia paid some $330 million in bribes for government favors last year, according to a report compiled by an independent economic research group.
The amount equaled about 2.8 percent of the businesses' total annual turnover and also represented a huge loss in state revenue, said the report by the Economic Institute of Cambodia. The summary of the report, officially to be released July 18, was obtained by The Associated Press on Thursday.
The bribes were paid to countless government agencies seeking bribes in exchange for delivering services, said the report, which was based on survey results from 1,200 enterprises in nine municipalities and provinces of Cambodia in April.
"To receive efficient and rapid public services, the use of middlemen and directly contacting public officials become a necessity," it said. "In general, once the unofficial fees are paid, enterprises receive efficient services from public officials."
Bribes also seem to have an impact on tax collection, the report said, noting that revenues collected fall short of what would be collected under the official tax rate.
"In spite of the significant progress in collecting domestic tax revenue made by the Tax Department, only about 25 percent of the potential tax was collected from the private sector in 2005," it said, adding that the potential loss in government revenue due to corruption could even reach $400 million.
Last year, a study prepared for the U.S. Agency for International Development reached similar conclusions, saying that Cambodia lost an estimated $300 to $500 million annually to various forms of corruption.
Neou Seiha, a spokesman for the institute, declined to elaborate on the report, which he said will be officially launched on July 18.
Khieu Kanharith, the chief government spokesman, could not be immediately reached for comment.
The Cambodian government has been repeatedly slammed by donors and civil society groups for doing little to tackle endemic corruption.
The World Bank recently suspended several development projects with the government after claiming to find corruption in several contracts worth millions of dollars.
The government has argued the bank has not shown any adequate proof.
The report said the money lost to corruption could have been used to raise salaries for civil servants, many of whom are paid about 120,000 riel ($29) a month.
It said the interviewees also rated poorly government institutions in term of their honesty and integrity. The court system and the tax and custom department got the worst marks, it said, while water and sewage service was rated the least corrupt.
The amount equaled about 2.8 percent of the businesses' total annual turnover and also represented a huge loss in state revenue, said the report by the Economic Institute of Cambodia. The summary of the report, officially to be released July 18, was obtained by The Associated Press on Thursday.
The bribes were paid to countless government agencies seeking bribes in exchange for delivering services, said the report, which was based on survey results from 1,200 enterprises in nine municipalities and provinces of Cambodia in April.
"To receive efficient and rapid public services, the use of middlemen and directly contacting public officials become a necessity," it said. "In general, once the unofficial fees are paid, enterprises receive efficient services from public officials."
Bribes also seem to have an impact on tax collection, the report said, noting that revenues collected fall short of what would be collected under the official tax rate.
"In spite of the significant progress in collecting domestic tax revenue made by the Tax Department, only about 25 percent of the potential tax was collected from the private sector in 2005," it said, adding that the potential loss in government revenue due to corruption could even reach $400 million.
Last year, a study prepared for the U.S. Agency for International Development reached similar conclusions, saying that Cambodia lost an estimated $300 to $500 million annually to various forms of corruption.
Neou Seiha, a spokesman for the institute, declined to elaborate on the report, which he said will be officially launched on July 18.
Khieu Kanharith, the chief government spokesman, could not be immediately reached for comment.
The Cambodian government has been repeatedly slammed by donors and civil society groups for doing little to tackle endemic corruption.
The World Bank recently suspended several development projects with the government after claiming to find corruption in several contracts worth millions of dollars.
The government has argued the bank has not shown any adequate proof.
The report said the money lost to corruption could have been used to raise salaries for civil servants, many of whom are paid about 120,000 riel ($29) a month.
It said the interviewees also rated poorly government institutions in term of their honesty and integrity. The court system and the tax and custom department got the worst marks, it said, while water and sewage service was rated the least corrupt.
4 comments:
To cobat corruption, Cambodian government must re-establish personal income tax. Tax base per person. All salary earner, wage earners and businessmen must register tax number. People who can be exampted from these these personal tax are rice growers. In this concept, Noone in Cambodia can escape tax or can corrupte because at the end of financial year, everyone must file their income return. Cambodian tax department can call all those with suspect of tax invasions to face to face interview for their irregularity income. This kind of tax system is the most fair for any society. And all income tax must be gradually increased for those who has earned the most.
eg earn per year tax per %
US$ 1,000,000.00 50%
US$ 500,000.00 and over 48%
US$ 100,000.00 and over 45%
US$ 20,000.00 and over 35%
US$ 10,000.00 and over 25%
US$ 3,000.00 and over 10%
Everyone must add up all their income from all source. We call this as wealth distribution.
it doesn't exist in this communist country....eeyore
Sound good for your listing of getting the tax from the Cambodian people. You must never be in Srok Khmer. Ah Hun Sen never paid a penny to help the poor. Whatever he wants for the poor, he just tell the rich man called Ouk Yar (OY) to build a new school or donate money to the poor. If he wants $30,000 by tomorrow evening, his team will go and collect it. If he wants something done, OY will provide him because they can do whatever they wants. Therefore, Ah Hun Sen never spent a penny. Every day how much money he makes. I heard his child's wedding get a bowl of car keys that OY gifts to his child.
In Cambodia corruption is from bottom to top. Do you know how many houses Ah Sok Ann has? Even Ah Sok Ann can't keep track of his house. He has a lot of houses in Cambodia. How can all these OY and Erk Oudom (EO) lost power? They do whatever they can to hold on to power. Too many poor people in Srok Khmer and a small bunch of rich people who holds dollar bills like papers. In Cambodia if one has title like doctor, OY, EO, or other title, their self-ego is very high.
One thing to change this regime is to do one more revolution in Cambodia. We all need to sacrifize to get rid of CPP and Royal. Otherwise, Cambodia will become Prey Norkor II.
good points,, i like your idea!!.
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