Cambodia has reduced the VAT on gasoline and diesel, with the state covering the difference, as part of measures to ease the impact of rising global oil prices. The reduction applies to domestic supply and imports until further notice.

RF Report

Cambodia’s Ministry of Economy and Finance (MEF) has announced a reduction in the Value Added Tax (VAT) rate on petroleum products, specifically regular gasoline and diesel, in a move aimed at easing the impact of rising international fuel prices and supporting the living standards of Cambodian citizens.

Under the measure, the VAT rate on the import and domestic supply of regular gasoline and diesel will be lowered from 10% to 4%, effective 20 March 2026. The reduction represents a 6% decrease in the tax burden.

The MEF has issued detailed guidance for import and distribution enterprises of petroleum products:

  • VAT application on domestic supplies
      • Enterprises must apply VAT at 4% for domestic supplies of regular gasoline and diesel.
      • For customers subject to the self-declaration tax system, VAT invoices must be updated from “VAT 10%” to “VAT 4%.”
      • For end-users not under the self-declaration system, standard invoices should include VAT at 4% in the total sale price.
      • VAT already paid at 10% or 4% on imported or locally purchased regular gasoline and diesel may be claimed as a credit against input tax, provided proper customs receipts, VAT invoices, or payment documents are available. VAT credits for other goods remain subject to standard VAT regulations. 
  • Tax system updates
      • The General Department of Taxation will update the online monthly business tax declaration system (e-Filing) to include a new entry under “Purchase-Sale Records” for “Supplies subject to 4% VAT,” facilitating compliance with the new VAT rate. 
  • Implementation and validity
    • The instruction takes effect 20 March 2026 and will remain valid until further notice by the Royal Government.
    • All import and distribution enterprises of petroleum products subject to the self-declaration system are required to comply strictly with this instruction.