Iraq steps up efforts to double non-oil revenues

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[size=52]Iraq steps up efforts to double non-oil revenues[/size]

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2024-09-05
Baghdad: Huda Al-Azzawi
Earlier last month, Prime Minister Mohammed Shia Al-Sudani chaired a meeting of the Supreme Committee for Monitoring the Implementation of Tax Reform, during which what had been accomplished was reviewed in accordance with the relevant Cabinet decisions, including an increase in tax revenues by (22 percent) for the current year until the beginning of this August.[/size]
[size=45]Al-Sudani also stressed that the economic reform adopted by the government as part of its programme, took into account the importance of tax reform as a strategic option.[/size]
[size=45]The meeting presented to the Prime Minister the efforts to prepare a new draft law for income tax in Iraq with the German Cooperation Organization (GIZ), and by adopting international standards that are friendly to the business environment and support the private sector, in order to achieve tax justice, as well as the steps to prepare a new draft law for sales tax in Iraq, and to prepare a draft amendment to the real estate transfer tax law. According to these economic steps, Counselor Saleh believes during his interview with “Al-Sabah” that “taxes constitute in total in developed countries about (25) percent of the gross domestic product, while in Iraq they do not exceed (4) percent due to tax evasion, as the gray market unknown to tax authorities constitutes a percentage close to (70) percent of the market or private sector activity, while negative taxes, which are cash income subsidies paid to the poor class, constitute (5) percent of the annual gross domestic product, and this constitutes the tax imbalance that compensates for the difference between the type of tax and the revenues of oil rents.” The spokesman pointed out that the government's plan for tax reform is to raise non-oil revenues in the annual general budgets from (10) percent to (20) percent, stressing that "the optimal strategic option in economic reality is to expand the tax coverage on tax evaders instead of increasing the tax capacity on taxpayers identified in the tax register." Regarding the preparation of a draft tax law according to the statement of the Council of Ministers in its last session, the rapporteur of the Parliamentary Finance Committee for the fourth session, Dr. Ahmed Al-Saffar, indicated in a statement that "the tax laws in Iraq need to be abolished and new laws enacted, especially the Income Tax Law 113 of 1982 as amended, in addition to the Real Estate Tax Law, as well as the indirect taxes law, whether customs or production."[/size]
[size=45]Al-Saffar noted that “Iraq needs a legal and administrative reform revolution in addition to the financial aspects and tax assessment, due to the financial policies that led to the inflation of the operating budget, and the most resources going to the consumer side at the expense of the investment side, in addition to the structural defect represented by the government’s expansion in the field of appointments and salaries.” It is noteworthy that the Parliamentary Finance Committee held a joint meeting the day before yesterday with the Chairman of the General Tax Authority, Ali Waad Allawi, and the Chairman of the General Customs Authority, Hassan Hamoud Al-Akeili, to discuss tax and customs policies that would enhance and support the federal general budget, in addition to financial reforms that aim to enhance government revenues. The Chairman of the Finance Committee, Engineer Atwan Al-Atwani, explained during the meeting that the aim of hosting is to listen to opinions and exchange ideas, indicating that this meeting comes as part of a series of previous meetings aimed at addressing the financial situation and increasing non-oil resources, indicating that the committee met with the Ministers of Planning, Finance and Electricity to discuss this file, and it continues to host the relevant parties, including the Tax and Customs Authority, given their importance in supporting the general budget. Stressing the need for these meetings to yield positive results. For his part, the Chairman of the General Tax Authority revealed that there are efforts to increase the tax base, pointing out that work has begun to activate tax accounting for private universities, colleges and companies, explaining that this step has contributed to reducing the rate of corruption and extortion, while pointing out that foreign players and coaches are subject to tax accounting.[/size]
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