Tax squeeze

ENAR

Lebanon is closer to ratifying a national budget than it has been in recent memory. For the past 12 years, the country has not passed a budget into law. In recent years the roadblock has been, at least publicly, a salary increase for certain public sector workers. The debate is taking place in a fiscal environment where the money to raise public spending is non-existent, so the revenue needs to be created – through new taxes. To fund the salary increase, some economists and some politicians are arguing for reforming public spending rather than setting new taxes. Announcing the budget figures at a press conference on the last Thursday of March, Minister of Finance Ali Hassan Khalil provided little by way of details. He laid out spending cuts, and stated that the budget is primarily based on improving tax collection and administration – collecting taxes already on the books, rather