Jordan's new progressive prime minister told to address protester concerns on tax reform

King Abdullah says taxation must be 'just and fair' on lower and middle classes after sacking Hani Mulki

June 06, 2018 13:34

For the second time in two weeks, unions downed tools throughout Jordan demanding the withdrawal of a controversial income tax proposal.

Hundreds of people took part in nightly street protests, which tapered down after King Abdullah suspended a fuel price hike and sacked his prime minister Hani Mulki.

Widening and deepening the base of those paying income tax was a commitment to the International Monetary Fund, which made tax reform a condition of a three-year $732 million loan.

Jordanians earning less than 12,000 dinars (£12,580) are currently exempt from income tax, but the government proposed lowering this to 8,000 dinars — or double for families.

Even if implemented, it would still only apply 10 per cent of  Jordanians, whereas everyone pays an exorbitant 16 per cent sales tax. It makes Amman the costliest Arab city and the 28th most expensive in the world, when compared to its residents’ income.

Jordan has passed 70 percent of its IMF commitments and this law, already delayed for a year, would complete the world lender’s demands, Mr Mulki had said.

Finance Minister Omar Malhas told reporters that Jordan stood to lose not only the IMF loan but also other creditor nations like Japan too, as they have conditioned their support on IMF approval.

But professionals such as lawyers, doctors and engineers were most affected by the draft law and it was they who led the protests, later joined by the wider public.

Mr Mulki will be replaced by his education  minister, Harvard graduate Omar Razzaz. The new prime minister’s letter of appointment from  King Abdullah specifically called for a “just and fair” tax law that does not further burden the middle and lower classes.

Mr Razzaz, his successor, was a minister of education in the outgoing Mulki government and is known to be progressive and liberal in approach.

His father was one of the founders of the Iraqi Baath party but broke ranks with Saddam Hussein and died under home arrest in Baghdad in 1984.

June 06, 2018 13:34

Want more from the JC?

To continue reading, we just need a few details...

Want more from
the JC?

To continue reading, we just
need a few details...

Get the best news and views from across the Jewish world Get subscriber-only offers from our partners Subscribe to get access to our e-paper and archive