Ministry of Industry considering taxing imports to protect the industrial sector in Lebanon

The Minister of Industry, Dr. Hussein Hajj Hassan, revealed his intention to introduce new taxes on imported goods especially those subsidized in their country of origin and which are competing with Lebanese goods.  Hajj Hassan was speaking yesterday during his meeting with a delegation of Lebanese and Chinese business people.  Hajj Hassan emphasized that the role of the government and of the private sector is to facilitate exports and not to remove hurdles from imports.  Hajj Hassan reiterated that policies to address the economic crisis should include reciprocity policies and taxing of imports so as to enhance domestic consumption of local products and curtail the deficit in the balance of trade which reaches USD 16.7 billion last year and thus representing one third of GDP which is estimated at USD 45 billion.  Hajj Hassan also pointed out to a number of negative economic indicators, namely the drop in remittances, the current level of the national debt which reached USD 60 billion, and the fall in industrial exports.  He added that Lebanon’s exports have decreased by 9.3% during the last 8 months of 2014 compared with the same period in 2013.  According to the Daily Star who quoted various informed sources, the Ministry of Industry has indeed started two weeks ago to introduce taxes on aluminum so as to support local production.  It is also intending to impose taxes on other goods such as leather, steel, plastic, paper and some food products.  The president of the Industrialists Association, Fady Gemayel, thanked the Minister for introducing these new measures but added that Lebanese industrialists need also to be supported through subsidizing their high cost of energy which makes up 35% of the cost of production.  He also stated that supporting the high energy consuming industries will only cost 30 to 40 million dollars a year, an amount which he considered to be modest when compared with the deficit of the Electricity Public Company which has soared to USD 2 billion a year.  He added that these industries are worth supporting since they provide 7000 work opportunities.

(Source: Daily Star 9 January 2015)