Central bank of Lebanon
A delegation of Lebanese economic bodies chaired by former Minister Adnan Qassar, paid a visit to the presidential palace at Baabda to handed over proposals related to the draft budget to President
Michel Sleiman. The proposals rejected the new amendments in the draft budget regarding intended taxation measures.
Nicolas Chammas, Chairman of Beirut Traders' Association said after the meeting that the delegation had informed President Sleiman about the reservations of Lebanon's economic bodies concerning taxation issues.
"There are too many amendments --57 -- which are not sustainable for businesses in Lebanon. This number of amendments is against the legislative and taxation stability needed in any country, it could also ruin Lebanon's reputation as an attractive place for investment" said Chammas.
"Businessmen are already suffering due to the raising of the wages ceiling and interest on loans, so we can't sustain a tax rise too, especially during the economic recession Lebanon is experiencing. If these amendments are passed, they will have a harmful effect on all sectors of our national economy, particularly the industrial and production sectors," he added.
Chammas also revealed that the delegation members expressed their reservations to Sleiman about most of the new taxes suggested in the budget, particularly those taxes which the government have suggested to be applied on banks, stock shares, real estate and capital assets, in addition to the double taxation intended to be applied to value-added tax.
The Economic Bodies Union earlier issued a report on its evaluation of the draft budget. The report was sent to the president of the republic, the prime minister, speaker of the house, the minister of finance and the governor of Lebanon's Central Bank.
The report expressed concerns that the suggested tax amendments would be harmful to the very foundations that have kept Lebanon's economy in a relatively healthy state for so long, and enabled it to achieve high growth ratios. Lebanon's banking sector has succeeding in attracting large amounts of foreign capital, that has given Beirut a positive reputation as a main financial and investment centre in the Middle East.
The report added that these amendments are likely to create the opposite results to what the draft budget amendments intend, and result in a decrease in the tax revenues gained by the state, killing any chance of growth in the Lebanese economy, and discouraging foreign investments from entering the country.
The report concluded: "all these amendments should be withdrawn and discussed first by the relative parliamentary committees, with consultation from experts and businessmen working in Lebanon."