What Does Hun Sen’s Big Tax Hunt Mean for Cambodia?

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What Does Hun Sen’s Big Tax Hunt Mean for Cambodia?

The premier’s moves are proving to be destructive for the media and business in the Southeast Asian state.

What Does Hun Sen’s Big Tax Hunt Mean for Cambodia?
Credit: Flickr/World Economic Forum

It’s been a tough past few weeks in Cambodia. Prime Minister Hun Sen has gone on the offensive, with his bureaucracies enforcing laws which his critics argue are being used to shut down free speech and his critics ahead of elections due in July next year.

Journalists, including this one, have also been singled out, and erroneously accused of taking sides that are opposed to the government (my response was published by The Khmer Times).

One radio station has closed, while the National Democratic Institute (NDI) in Cambodia has been also forced to close and its staff expelled, prompting a rebuke from the ASEAN Parliamentarians for Human Rights (APHR). It said there had been serious concerns about the new controversial Law on Associations and NGOs (LANGO).

“Serious concerns about the LANGO’s provisions, and the potential for their misuse, have been expressed by APHR and others in the past. Shuttering NDI without giving them an adequate opportunity to respond to these allegations has brought these fears to life.

“The fact that this comes in a context of increasing repression of freedom of expression and civil society space in Cambodia is all the more worrying, and hints at continued attempts by the ruling party to consolidate power ahead of next year’s national elections.”

But this week, the biggest concerns remained with the media, with the Cambodia Daily looking to face closure soon unless it can pay a tax bill in excess of $6 million.

No one disagrees with Cambodia’s right to tax. But the government and bureaucracies have proved incapable of even accepting tax payments from those who voluntarily offered to pay dating back decades. Now they are being taxed, fined with interest up to double the initial tax bill, and given six weeks to pay and no right of appeal.

One media outfit that declined to be named helped put it in perspective. When asked if the company had been hit by an unexpected tax bill, the owner replied: “Don’t ask – we’ve been screwed over tax – and trying to get people to fix the problem is impossible.”

Another head of a broadcaster said in regards to the arbitrary nature of billing: “We could pay the bill but who’s to stop them from billing us again in six months’ time?”

Additionally, an Australian journalist is languishing in jail after being charged with spying and two Cambodia Daily journalists are also before the courts. It’s a situation that resonates badly across an electorate already mindful of the assassination of the popular broadcaster Kem Ley mid last year.

Voice of America and Radio Free Asia are two media organizations under the microscope of Hun Sen’s tax department, alongside the Phnom Penh Post. Sources at The Khmer Times say their tax bills have been paid.

The Overseas Press Club of Cambodia (OPCC) noted: “The Cambodia Daily has a history of running stories that have angered the government leading many to believe the tax department is being used to target critics ahead of the 2018 general elections.

“The Cambodian people have enjoyed a free press for much of Hun Sen’s 32 years as prime minister. Even as neighboring countries in Southeast Asia were consistently ranked at the bottom of press freedom lists.

“The OPCC asks the government of Cambodia to consider this fact carefully and proceed with transparency, fairness and due process.”

Whether Hun Sen is in a mood to listen to those who have his country’s best interests at heart remains to be seen. That includes members of his own Cambodian People’s Party (CPP) who have much at stake, politically and financially.

Compounding Cambodia’s problems is U.S. President Donald Trump. He has just announced visa sanctions on Cambodia along with three other countries – Eritrea, Guinea, and Sierra Leone – for their refusal to take back their nationals who are convicted criminals in the United States.

As the history of sanctions has shown, as in Myanmar, they are often applied for one reason and then complicated by another. No sooner had the sanctions been announced that we saw the State Department come out and attack Hun Sen for undermining the media and NGOs.

“Two months ago, Cambodia received widespread recognition for running transparent, peaceful local elections. In the past two weeks, however, the achievement has been eclipsed by troubling government actions curtailing freedom of the press and civil society’s ability to operate,” Heather Nauert, U.S. State Department spokesperson, said.

That in fact understates the events of recent weeks and the shenanigans initiated by Hun Sen. The prime minister has attracted the eyes of the world even more onto Cambodia, promising a long and arduous time between now and the elections in July.

Luke Hunt can be followed on Twitter @lukeanthonyhunt