UNDP Cambodia


Leveraging UNDP Country Office Support in Cambodia to Raise Resources and Strengthen Tax Revenue Collection

By Nick Beresford, Resident Representative, Chandarany Ouch, National Economist, UNDP Country Office Cambodia and Chris Brolly, International Tax Specialist, International Relations and Capacity Building Unit, HMRC
September 2021


Assistance in transfer pricing audits helps Cambodia’s economic recovery and transformation efforts

The COVID-19 pandemic has led to over 85,000 cases and more than 1,683 deaths in Cambodia[1]. It has also taken a significant toll on Cambodia’s population and economy with economic growth turning negative at -3.1% in 2020 and human development set back by more than four years[2] sending many communities back into poverty.[3]


This social and economic shock was especially keenly felt given the remarkable progress Cambodia had experienced up until the COVID-19 outbreak, with poverty falling from 48% in 2007 to below 10% by the end of 2019,[4] and economic growth averaging over 7% over the 15 years to 2019.

Phnom Penh, Cambodia

For Cambodia, the impact of COVID-19 could have been worse still, but the highly effective cash transfer programme implemented by the Government helped protect many at risk from falling into poverty. The United Nations Development Programme (UNDP) estimates the programme improved poverty figures by 4% and had a positive impact on economic growth of nearly 1%. The experience has opened policy opportunities to reframe such programmes as investments in people that can help mitigate immediate crises and serve as a key component of Cambodia’s longer-term transition to an upper middle-income country.

The question now arises of how Cambodia might continue to finance and indeed expand these human development investments. A key measure to raise resources and strengthen revenue collection capacities and mechanisms is through a new programme facilitated by Tax Inspectors Without Borders (TIWB) - a joint initiative of UNDP and the Organisation for Economic Co-operation and Development (OECD) to ensure multinationals and other large companies are paying their fair share of tax.


TIWB directly responds to international taxation assistance requests from developing country tax administrations, with programmes leveraging experts from either partner tax administrations or the TIWB Roster of Experts. Within this context, two international tax experts from the United Kingdom’s HM Revenue & Customs (HMRC) commenced implementation of a TIWB programme with Cambodia’s General Department of Taxation in 2020 in response to a request to provide guidance on transfer pricing audits of multinational enterprises. Since the Cambodian transfer pricing legislation was only introduced in 2017, the support from tax experts on transfer pricing audits is crucial to building local auditors’ capacity.

Delivering TIWB programmes through closer engagement and leveraging of UNDP Country Offices (CO) in the time of COVID-19


The UNDP CO in Cambodia has been involved in the TIWB programme since its inception, building a good working relationship between UNDP CO colleagues and HMRC’s TIWB experts. The CO has gained a comprehensive understanding of the support provided by TIWB experts with the General Department of Taxation and the goals under the programme. With progress on tax audit cases, this close connection between the CO and experts is integral to TIWB programme implementation. Since physical travel to Cambodia is not possible due to COVID-19 restrictions, all interactions with the General Department of Taxation so far have taken place via video conferencing and e-mail exchanges. 

 ‌General Department of Taxation, Cambodia
©️Manuth Buth

(c) Manuel Buth

The CO was able to liaise directly with the General Department of Taxation team and provided funding for necessary licences to enable local auditors to participate in regular virtual meetings with the TIWB experts. Fostering trust and relationship-building is often more difficult through virtual settings, so being able to consult with UNDP CO for advice on how best to support Cambodia’s Ministry of Finance, as well as to discuss the best approaches to take when attempting to progress matters, has been beneficial for the TIWB experts.


Future areas of UNDP CO’s support may extend to assisting the Ministry of Finance in raising awareness of the transfer pricing requirements in Cambodia in order to improve voluntary compliance, as well as providing feedback on how businesses and advisory firms perceive compliance and tax issues in Cambodia.


While the TIWB experts are required to keep any information about their work with the Department of Taxation confidential, they can connect the niche TIWB work with the broader domestic resource mobilisation efforts needed to achieve the 2030 Agenda. UNDP Cambodia’s portfolio includes numerous programmes and initiatives in the fields of energy, environment, health, social protection, and finance and the CO is working to create synergies between TIWB and SDG-related fiscal policy work by facilitating and integrating these streams of work to support Cambodia in achieving its National Strategic Development Plan and Sustainable development Goals.[5]


[1] WHO Situation Report, 16.08.2021.
[2] UNDP (2021): HDI impact of COVID on Cambodia.
[3] UNDP (2021): Cambodia’s Development Finance Assessment. Phnom Penh.
[4] MoP (2007): CECES, UNDP estimate 2019.
[5] Royal Government of Cambodia (2019): National Strategic Development Plan. Translation. Phnom Penh.


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