Analysis by Iraqi experts: What comes after raising gasoline prices? New taxes, a scenario of demons

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[size=52]Analysis by Iraqi experts: What comes after raising gasoline prices? New taxes, a scenario of demonstrations and Karbala may save the situation[/size]

[size=45]Iraqi public opinion was preoccupied with the government’s decision to raise the prices of improved and premium gasoline by about 200 dinars, and activists and parties spoke about the effects of this and expected a wave of popular protests opposing this step, which Baghdad says aims to relieve traffic congestion and reduce the movement of vehicles that have become “out of control,” especially in Large cities, as well as ongoing demands issued by the International Monetary Fund and global institutions partnering with Iraq in “economic reform,” focus on the necessity of reducing subsidies on fuel prices and many other commodities and moving to the “tax reform” phase.[/size]
[size=45]details:[/size]
[size=45]But economic experts explain the matter beyond that, as the government’s expenditures have doubled according to the three-year budget, which was described as “explosive,” and it is dealing with projects that have been lagging since the war on terrorism in 2014, in addition to new projects, anticipating additional measures that will affect the individual economy, such as imposing taxes. They are new to various commercial and service sectors, but they also mentioned that the entry of new oil refineries into operating at full capacity, as in Karbala, may ease the fuel import crisis during the coming period and give the government options to get out of the current “austerity crisis.”[/size]
[size=45]Mustafa Hantoush, economic expert:[/size]
[size=45]Iraq imports more than 85% of improved gasoline, so the price of a liter in 2019 was 850 dinars, and in the years 2020-2021, oil prices witnessed a decline, which led to a reduction in the price of fuel locally.[/size]
[size=45]But now, international prices are high, and therefore Iraq is losing large sums of money from selling improved gasoline at a price of 650 dinars per liter.[/size]
[size=45]Raising fuel prices will have major negative consequences for the Iraqi citizen, as it will raise transportation fees and other matters.[/size]
[size=45]Implementing the idea in this way will entail errors, but when the Karbala refinery, which produces improved gasoline, will operate at full capacity, the government will be able to reduce prices, noting that the refinery is currently operating with a production capacity that does not exceed 35%.[/size]
[size=45]Last year, the government spent 142 trillion dinars, and therefore this year it is seeking to reduce spending.[/size]
[size=45]The large financial spending on projects to relieve traffic congestion and return to work on lagging projects while starting new projects must leave impacts on the citizen’s spending.[/size]
[size=45]The government's economic measures have not been of any benefit, and therefore the markets and economic activity throughout Iraq are currently suffering from a kind of paralysis.[/size]
[size=45]According to expectations, the government is seeking in the next stage to impose new taxes that will include additional sectors and will also have an impact on the individual economy.[/size]
[size=45]Duraid Al-Anazi, economic expert:[/size]
[size=45]The decision was mainly aimed at reducing the number of cars on the street and reducing traffic congestion, because most citizens will travel by taxi due to the high prices of gasoline.[/size]
[size=45]The decision is expected to have negative consequences for the government, and we will not be surprised if we soon see angry demonstrations denouncing this step that affects their daily livelihood.[/size]
[size=45]There may be dire consequences, and this decision indicates a flaw in the government's economic vision regarding studying and making decisions.[/size]
[size=45]The decision will greatly affect citizens, because when the government raises prices, it does not compensate for it with any parallel facilities, salary increases, loans, etc.[/size]
[size=45]When the government plans to reduce spending, it is supposed to start with itself, for example by reducing the number of government cars and officials' wheels.[/size]
[size=45]Another solution that could address the issue of raising the prices of improved and super gasoline is activating public transportation.[/size]
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