Editorial

  Issue No 6, Dec 2002

A Word From Us

A correct step on a faltering path

In life and definitely in politics, things are not always as they seem. In Lebanon, fully cognizant of this conventional wisdom, “we rejoice in having something over which to rejoice”. Thus, did the government rejoice in its issuance of a tax that was named the Value-Added Tax (VAT) instead of calling it what it is: a sales or consumption tax. We pay 10% VAT in addition to customs fees on a new, imported car, for example, without asking what was “value-added” and by whom.

As a matter of fact, we pay approximately 12% on the import price (since customs fees are inclusive in the price, over and above which the VAT is added). However, we continue to call it 10% in Value-Added tax. This dichotomy is not coincidental, nor are the politicians of Lebanon naive enough not to see it. The fact is that all prime ministers and key politicians since 1993 have stated that the tax system in Lebanon is unfair and favors the rich. That is why a complicated term like the VAT (translated into arabic as qima al moudafa) can easily be passed, like a convoluted name for a medical product with a supposed magical cure. This is how we avoid talking about capital gains tax and progressive income tax and other tools that might help achieve more social parity, and then we throw in an issue like exclusive agencies to divert attention and fuel social feuds.

In spite of all that, the so-called VAT is a tax that should theoretically yield other added-value issues, since direct tax implies more transparency and hopefully, accountability. As for its impact on consumer spending and growth, 2003 will be the year for a proper assessment. However, and until the tax system is revamped, the “VAT” will continue to be a correct step on a faltering path.


Jawad Adra
Managing Partner

  

  Current Statistics

Elections

• $280,000 was the government cost of conducting the Metn election.

Privatization

• $1 million was provided by the government to the the Higher Council for Privatization, in addition to the $1.3 million that was supplied in early 2002.

Secret Service

• 31 military rifles with added equipment, which differ from the standard gear, were provided as a grant to the General Administration for Internal Security Forces. These rifles were granted by the Prime Minister for use by security guards to protect the Prime Ministership.

Compensation

• $6.6 million is the compensation that the government will pay to owners of public and private buses that operate on diesel, which has been banned by the government.

Sports Arenas

• $530,000 is the annual cost of cleaning and maintenance of the Sidon and Tripoli sports arenas.

Banking Sector

• $90 million equals net profits of four Lebanese banks (that hold 38% of the country’s deposits) up until the middle of 2002.

 

 

Company Activities

  
 

Lessons in bee-keeping
In a joint project between the Inma Association and the Ministry of Agriculture, 20 women from the caza of Akkar (from Berkayel and Jdeideh) participated in a workshop on bee-keeping. The objective of this project is to develop the areas of Berkayel and Jdeideh while promoting the environment and the participation of women in the economic life of the region.

The women (10 from each village) were educated on the life cycle of bees and trained to care for them with two workshops per week that were supervised by experts in bee keeping. Both the theoretical and practical aspects of the process were covered over a total of 12 workshops.

Once the training was complete, a location that was suitable to the women of both towns was chosen and they were provided with the necessary equipment to run the operation on their own. As the first project of its kind for women in the country, this venture has received recognition from international agencies and NGOs. The expected outcome from each wax cell cultivated by the bees is eight kilograms of honey per season. Projections for the project are as follows:

• First year: 20 cells (160 kg. of honey) in the autumn season.
• Second year: 40 cells resulting in 640 kg. of honey for both the spring and autumn seasons.
• Third year: 80 cells with 640 kg. per season.
• Fourth year: 160 cells with 1,200 kg. in the spring.

 

 

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