Royal Government Unveils Siem Reap Tourism Tax Relief for 2026

The Royal Government has announced a set of one-year tax measures for tourism businesses in Siem Reap province in 2026, aimed at supporting the sector's recovery amid fluctuating international arrivals.

Hotels, guesthouses, restaurants, and travel agencies will benefit from an exemption on monthly taxes—except for VAT and the accommodation tax—a cancellation of the annual income tax, and a deferral of 2026 payments to 2027 obligations. Eligible businesses will also be exempt from tax audits for the fiscal year. These measures, approved by the Ministry of Economy and Finance, seek to ease financial pressures on operators and stabilize employment in this province, home to the Angkor archaeological park, a UNESCO World Heritage site.

Siem Reap, which traditionally attracts more than half of foreign visitors to Cambodia, is suffering from a persistent drop in tourism revenue. According to official figures from the Ministry of Tourism, international arrivals in January 2026 fell 34.5% compared to the previous year, following a 2025 marked by 5.45 million tourists, short of the 6 million hoped for. The National Bank of Cambodia notes a 12% contraction in tourism receipts in the first half of 2025, attributable to increased regional competition (Thailand, Vietnam) and global economic gloom.

Despite these headwinds, the Ministry of Tourism anticipates between 5.6 and 5.8 million international visitors in 2026, thanks to market diversification (a 20% rise in Chinese and Indian tourists) and promotional campaigns. Angkor Enterprise, which manages the site, reports an 8% increase in attendance in 2025 compared to 2024, but warns of the vulnerability of small operators: 30% of Siem Reap hotels have reduced capacity or temporarily closed.

This relief package fits into a broader Phnom Penh strategy to rebuild the tourism pillar of the economy, which accounted for 12% of national GDP pre-pandemic. Experts like Thourn Sinan, director of the Cambodia International Relations Institute, welcome the initiative but call for structural reforms: improvements to airport infrastructure and sustainable promotion of Angkor to counter overcrowding. It remains to be seen whether these measures will be enough to reverse the trend before the high season.