AMMAN — Industrialists said on Sunday that a
government plan to reduce customs duties to about 5 percent, to combat evasion
or avoidance "will not work," stressing that an ideal tariff is the
one that guarantees a continuous flow of government revenue on the one hand and
protects the local industry on the other, according to the Jordan News Agency,
Petra.
اضافة اعلان
This came in a paper that the
Amman Chamber of Industry on Sunday presented to
the members of the Financial and Economic Committee in the Senate. According to
the paper, the contribution of customs revenues to the GDP in the period
2000-2020 decreased to 0.8 percent from 4.3 percent after the customs tariff
was reduced due to Jordan's ratification of several international trade
agreements.
The Amman Chamber of Industry said that the real burden on the citizen is the
sales tax, not customs duties, calling for a reduction in sales tax on basic
commodities.
According to the chamber, the customs revenue is about JD255 million, or 9 percent
of the total consumption of the
Jordanian economy, which means, according to
the chamber, that reducing the tariff or even canceling it will not have a
tangible impact on the economy, because it will not cause a shock on the demand
side.
The paper cited household expenses and income accounts, which indicate that 51
percent of Jordanian families, whose monthly income ranges between JD237–JD752,
pay between JD0.08–JD0.96 per month as customs duties on consumed goods while
paying JD86–JD200 per month as sales tax on the same consumed goods.
The chamber said that when the government reduced customs duties on clothing
and footwear in 2016, the price index in this sub-sector rose by 3.2 points
after six months, which confirms that the reduction was not reflected in the
final prices due to demand and supply in other markets.
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