Government postpones talk of new taxes to finance wage hike

Safadi and Andersson discuss the plan to fund public sector wage increases. (The Daily Star/NNA/HO)

BEIRUT: The government postponed Wednesday discussions on imposing additional taxes to fund a wage increase for public sector employees after it reached an agreement Tuesday on a first basket of taxes.

Tax hikes included LL1,000 tax on every land line and cellular bill; raising tax on the profits netted by lottery winners from 10 percent to 15 percent; and fines on illegal properties that were built along the coast during the Civil War.

The government tasked Finance Minister Mohammad Safadi with preparing draft laws on the taxes that had been agreed upon.

But these taxes may not be enough to finance even a small portion of the salary scale, which will cost the treasury more than $1 billion a year.

Safadi discussed Wednesday the government’s plan to fund the wage increase for public sector employees with a World Bank official.

Ingrid Andersson, vice head of the World Bank MENA office, praised the financial and economic policies adopted by the Finance Ministry that boosted the confidence of global financial institutions in Lebanon, according to the National News Agency.

Economic Committees, a group that represents businessmen and private sector leaders, has explicitly rejected any tax increase and warned against passing the salary increase at this time.

In a separate meeting Wednesday, Safadi discussed with the Japanese ambassador to Lebanon the promotion of bilateral trade.

A version of this article appeared in the print edition of The Daily Star on September 20, 2012, on page 5.




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