Jordan extends tax break on higher sea freight costs for six more months

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The decision, taken at Sunday's session on September 6, renews an exemption that applies to all goods arriving by sea and covers general and special sales taxes. The government said the aim is to sustain supply chains, keep goods moving and shield consumers from global price increases.اضافة اعلان

The measure it extends took effect on March 5, 2026, for six months, as part of a package the Cabinet approved to counter the economic fallout of regional tensions. That package also included the temporary suspension of a 1978 rule confining containerized imports to the Port of Aqaba, allowing shipments to enter through land border crossings.

Those working in the sector describe the extension as useful but partial. Freight rates, marine insurance and container availability all sit outside the government's reach, and several shipments are still arriving late.

Keeping goods moving
Deifallah Abu Aqoula, president of the Customs Clearance and Freight Forwarding Companies Association, called the extension a significant step toward sustaining supply chains and keeping the flow of goods steady.

Abu Aqoula told Al-Ghad that the decision helps limit the impact of global price increases on citizens and eases the pressure that higher shipping and transport costs place on importers and on the wider economy, particularly given the strains on global trade from regional and international conditions.

Removing the tax burden attached to the shipping increase, including general and special sales taxes, cuts additional costs and restrains their transmission into local market prices, Abu Aqoula explained. Stable maritime freight rates matter for the continued arrival of goods, raw materials and essentials, he added, and measures that hold those costs down support the competitiveness of both trade and industry.
Effect on prices depends on competition

Economist Qasim Al-Hammouri noted that shipping is part of a product's total cost and therefore feeds into its final price. Cutting the taxes tied to elevated freight rates removes a slice of that cost, he said, and in a competitive market that reduction can reach the shelf.

The benefit does not stop at finished goods. Al-Hammouri pointed out that many imports are production inputs for local manufacturers, so cheaper importing can improve the competitiveness of Jordanian products in regional and export markets. Sectors where transport makes up a relatively large share of expenses stand to gain the most.

Whether consumers see any of the savings depends on competition among sellers, Al-Hammouri argued, stressing the importance of passing part of the gain down the chain. He added that the measure could also help sustain trade activity and keep products available at a time of regional instability.

A blunt instrument for the food trade
Jamal Amr, representative of the food sector at the Jordan Chamber of Commerce, said the impact varies sharply by commodity. Goods already exempt under legislation or trade agreements gain little, while those subject to duties and sales tax see a clearer benefit. Rice, sugar and lentils are among the staples already exempt, Amr noted, so the decision changes little for them.

Importers face pressures the exemption does not address, Amr said, among them higher prices in countries of origin, costlier marine insurance tied to war risk, a shortage of containers and heavy competition for space on ships.

By his own estimates, drawn from recent transactions, shipping costs for some containers have climbed from a range of roughly $2,000 to $2,500 to around $6,000. Some 40-foot containers now run between $8,000 and $9,000 depending on origin and shipping conditions. War-risk insurance, Amr estimated, adds about $2,000 to a 20-foot container and about $3,000 to a 40-foot one. These are traders' estimates rather than official or standard rates, and they vary by shipping line, origin, container size and market conditions.

Delays compound the cost. Amr said limited vessel space, rerouting and additional port calls have stretched some voyages that once took about 30 days to between 40 and 45 days.

The extension therefore addresses the portion of the burden the government can control, while freight rates, insurance, container supply and vessel capacity remain governed by maritime markets and regional conditions. The measure sits within a broader set of government steps intended to maintain what officials describe as a safe and stable strategic reserve of essential goods, keep supply chains running and limit how much of the increase in maritime transport costs reaches importers, traders and consumers.


Source: Al-Ghad. Reporting by Mahmoud Khader Al-Shaboul.