On 26 June 2019, the Secretary for Financial Services and the Treasury, Mr James Lau, on behalf of the Hong Kong Special Administrative Region Government, signed a comprehensive avoidance of double taxation agreement (CDTA) with Cambodia, promoting further bilateral investment and trade between the two jurisdictions.

Under the Hong Kong-Cambodia CDTA, double taxation will be avoided in that any tax paid in Cambodia by Hong Kong companies in accordance with the CDTA will be allowed as a credit against the tax payable in Hong Kong on the same income, subject to the provisions of the tax laws of Hong Kong. Likewise, for Cambodian companies, the tax paid in Hong Kong will be allowed as a deduction from the tax payable on the same income in Cambodia.

Moreover, the Hong Kong-Cambodia CDTA also provides the following tax relief arrangements: 
        
(a) Cambodia’s withholding tax rates for Hong Kong residents on dividends, interest, royalties and fees for technical services will be reduced from the current level of 14 per cent to 10 per cent;

(b) Hong Kong airlines operating flights to and from Cambodia will be taxed at Hong Kong’s corporation tax rate, and will not be subjected to tax on income in Cambodia; and 
  
(c) Hong Kong residents deriving profits from international shipping transport in Cambodia will enjoy 50 per cent reduction in tax on income in Cambodia in respect of the profits subject to tax there.
  
 The Hong Kong-Cambodia CDTA has also incorporated an article on exchange of information, which enables Hong Kong to fulfil its international obligations on enhancing tax transparency and combating tax evasion.

The agreement will come into force after the completion of ratification procedures by both jurisdictions.