The recently signed sub-decree exempting export tax on rubber will greatly assist the struggling rubber industry in Cambodia when it comes into effect in April this year. The sub-decree, signed by Prime Minister Hun Sen, states that dry rubber will start being taxed US$25 per tonne if the market price is over US$1,400 per tonne; US$50 per tonne if the market price is between US$1,800 and US$2,500; US$100 per tonne over US$2,500; and US$200 per tonne over US$3,500. The Prime Minister said the export tax was adjusted primarily to assist local rubber plantations after calls from the private sector.
Vice President Lim Heng of An Mady Group, an international rubber exporter based in Cambodia, applauded the new tax rates and said the adjustment will help ease costs in a currently poor market, where many rubber plantation owners “are running their businesses at a loss.”
He added that the adjustment served as an incentive from the government as well, to stop farmers from removing rubber trees from their land and planting more currently economically viable crops.
According to the Ministry of Agriculture’s annual report, Cambodia exported 282,071 tonnes of dry rubber in 2019, at a 30% increase from the previous year. Its Government received around US$377 million from those exports, a 31.8% increase from US$286 million in 2018. The same report details the cost of one tonne of dry rubber in 2019 – on average US$1,336, a US$19 increase from 2018.
At that time, rubber export tax rates were US$100 per tonne between US$1,000-US$2,000; US$150 per tonne between US$2,000-US$3,000; US$200 per tonne between US$3,000-US$ 4,000; and US$400 per tonne over US$4,000.