Jordan's parliament approved a new income tax law on Sunday as part of reforms aimed at lowering its spiraling public debt and boost revenue and economic growth.
Members of parliament amended the 36-article bill to include raising family exemptions to contain its impact on middle class income earners. The law, which needs to be approved by the senate before it becomes law, is expected to be implemented next year. The International Monetary Fund-backed tax comes months after proposed reforms sparked protests this year over austerity measures.
Why is Jordan’s economy in such a dire state?
Resource-barren Jordan relies on foreign aid, grants and remittances to prop up its economy. A three-year oil slump reduced aid and remittance flows to the country from thousands of Jordanian expatriates residing in the energy-rich Arabian Gulf.
Official figures show that 750,000 Jordanian live abroad, with nearly 300,000 residing in Saudi Arabia, followed by 200,000 in the UAE.
The seven-year war in neighbouring Syria also dented economic growth. In 2017, the country received $3.7 billion in remittances, similar to figures in 2016.
The IMF has long called on donors to help Jordan shoulder the burden of hosting over one million refugees from Syria and Iraq that inflated the country's population to about 10 million.
The country's fiscal balance has also deteriorated as a result of Jordan’s import bill. The country imports 95 per cent of its energy needs. The kingdom's import bill has ballooned this year with the rebound in oil prices.
In June, Saudi Arabia, Kuwait and the UAE pledged $2.5 billion to prop up the kingdom's economy.
What is Jordan doing to amend its finances?
In 2016, Jordan agreed with the IMF on a three-year economic programme to help unleash $723 million in aid aimed at controlling the country’s deteriorating finances.
The plan aims to lower the public debt ratio to 77 per cent of gross domestic product by 2021 from the current 94 per cent of GDP.
The programme emphasises the need to reduce the general sales tax and custom duty exemptions and amend the income tax law.
Jordan’s high import bill, which swelled with the cut-off of supplies of Egyptian gas to the country during the Arab spring, is expected to be lowered with plans to import piped crude from Iraq and gas from Israel.
What is the outlook for Jordan’s economy?
According to the IMF, Jordan's economy will grow 2.5 per cent next year, up from 2.3 per cent this year, but below the 5.2 per cent average between 2000 and 2014.
Jordan’s current account balance is forecast to narrow to a deficit of 8.6 per cent of GDP next year form a deficit of 9.6 per cent in 2018 and 10.6 per cent in 2017.
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Other workplace saving schemes
- The UAE government announced a retirement savings plan for private and free zone sector employees in 2023.
- Dubai’s savings retirement scheme for foreign employees working in the emirate’s government and public sector came into effect in 2022.
- National Bonds unveiled a Golden Pension Scheme in 2022 to help private-sector foreign employees with their financial planning.
- In April 2021, Hayah Insurance unveiled a workplace savings plan to help UAE employees save for their retirement.
- Lunate, an Abu Dhabi-based investment manager, has launched a fund that will allow UAE private companies to offer employees investment returns on end-of-service benefits.
Sunday:
GP3 race: 12:10pm
Formula 2 race: 1:35pm
Formula 1 race: 5:10pm
Performance: Guns N' Roses
COMPANY%20PROFILE
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COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
Company profile
Name: GiftBag.ae
Based: Dubai
Founded: 2011
Number of employees: 4
Sector: E-commerce
Funding: Self-funded to date
How to help
Send “thenational” to the following numbers or call the hotline on: 0502955999
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Vidaamuyarchi
Director: Magizh Thirumeni
Stars: Ajith Kumar, Arjun Sarja, Trisha Krishnan, Regina Cassandra
Rating: 4/5
COMPANY%20PROFILE
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German intelligence warnings
- 2002: "Hezbollah supporters feared becoming a target of security services because of the effects of [9/11] ... discussions on Hezbollah policy moved from mosques into smaller circles in private homes." Supporters in Germany: 800
- 2013: "Financial and logistical support from Germany for Hezbollah in Lebanon supports the armed struggle against Israel ... Hezbollah supporters in Germany hold back from actions that would gain publicity." Supporters in Germany: 950
- 2023: "It must be reckoned with that Hezbollah will continue to plan terrorist actions outside the Middle East against Israel or Israeli interests." Supporters in Germany: 1,250
Source: Federal Office for the Protection of the Constitution
How to avoid crypto fraud
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COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners