The prevailing
impression among the public is that the general budget is in a tough financial
position, and that indictors are severely on the decline due to the
economic recession and the decline of the various economic sectors.
اضافة اعلان
Official statistics
released by the
Ministry of Finance show that the first four months achieved
numbers opposing the prevailing negative impressions and expectations, as tax
revenues increased by 27.3 percent compared to the same period last year, and
increased by 23.3 percent compared to the same period in 2019.
The increase in tax
revenues is attributed to a hike in income tax during the first third of the
year, amounting to 20.8 percent, (JD105 million); and 4.8 percent, (JD28
million); compared to the same periods of 2020 and 2019 respectively.
Real estate tax also
increased to reach JD9 million compared to the same period last year, constituting
a 90.2-percent rise; while it marked a 33-percent decline compared to the first
third of 2019.
Revenue from sales
tax, which represents the main artery of local revenue, grew by 29.7 percent
(JD285 million) in the first third of 2021, compared to the same period in
2020, while they increased by JD345 million compared to the same period in
2019. The growth was mostly attributed to a 35.1-percent rise in taxes
collected from imports, 12.2 percent from local goods, 30 percent from the
service sector, and 49.3-percent from the commerce sector.
Custom fees also
increased by 32.8 percent compared to the same duration in 2020, and by 9.2
percent compared to the same period in 2019.
After a major and
unprecedented setback last year registering a decline nearing JD1 billion,
non-tax revenues bounced back in the first four months of the year, with growth
of 63.3 percent compared to the same duration last year.
This rise is the
result of increases in collections of land fees (70.8 percent), stamps (33.6 percent),
work licenses (215 percent), vehicle licensing and registry fees (38.3
percent), and other revenues (31.4 percent); including mining fees (253.5
percent), and custom services allowances (20.9 percent), constituting 34
percent rise during the first third of the year. As a result, local revenues
increased by 34 percent (JD651 million) during the first third of 2021, an
increase of JD82 million during the same period of 2020.
The aforementioned
figures demonstrating the growth of domestic revenues in absolute values and
percentages in light of the pandemic have economic justifications, which argue
that the cogs of the national economy are running positively, despite the
difficulties. This is particularly true as it pertains to the tax structure,
which has achieved impressive success, as it had a great impact in compensating
for the Treasury’s non-tax revenues, which declined last year due to closures
and curfew measures.
The tax reform
implemented at the beginning of 2019 has begun to bear fruit for the Treasury,
through actual efforts to combat tax evasion, which was evident in various
sectors, as well as through expanding the taxpayer base methodologically to
include segments of large impact on tax revenues, such as physicians and
lawyers.
This is in addition to
a clear growth in some (not many) economic sectors, which led to an increase in
the Treasuries’ tax returns, not to mention the gradual return of Royal
Jordanian Airlines’ operations, along with the reopening of sectors and
slashing of curfew hours, which contributed to the growth of the state’s
non-tax revenues from the various fees.
The positive growth of
domestic revenues is a win for the Finance Ministry’s team, which stood its
ground during the pandemic, and at the same time, fulfilled all its internal
and external obligations without delay.
This financial success
will remain relative unless the ministry rises up at the same pace to address
the issue of public debt, which has reached 108 percent of GDP, which is a very
unsafe level, requiring rectifying measures similar to those imposed on
taxation.
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