Forming a Committee on Taxes Chaired by Badran, Holding “Education for Business” Seminar in Cooperation with Al-Rai Center for Studies

AMMAN ----- September 30, 2012----- The Executive Committee of the Economic Policy Development Forum (EPDF) has recently held its regular meeting under the chairmanship of HE Dr. Talal Abu-Ghazaleh. 

The meeting hosted HE Ms. Reem Badran, member of the Jordanian Parliament, who spoke about the Income Tax Law as well as the discussions that took place at the Parliamentary Financial Committee dealing with the Tax law.

Ms. Badran started by reading Article (111) of the Jordanian Constitution which states: “No tax or duty may be imposed except by law. Taxes and duties shall not include the various kinds of fees which the Treasury charges in respect of services rendered to members of the public by Government Departments or in consideration of benefits accruing to them from the State Domain. In imposing taxes, the Government shall be guided by the principles of progressive taxation, coupled with the attainment of equality and social justice, provided that taxation shall not exceed the capacity of tax-payers or the State’s requirements for funds”.

Ms. Badran further clarified that tax rates have changed over time; however tax policy has remained the same as the law mainly reflect financial policy rather than an economic policy.
The discussions tackled the potential effects of progressive taxes on industry, banks and other services, and whether they would affect competitiveness.  Ms. Badran explained that such a progressive tax should be carefully studied rather than absolute in order for us to move from segment taxes to progressive taxes, and not to base our decisions on opinion.

She added that the Parliamentary Committee has also tackled the combination of segment and progressive tax and the minimum income limit, saying that, according to discussions, a ratio of income of the medium and small size enterprises is to be exempted and tax is to be imposed progressively afterwards on the higher incomes within certain sectors.
Ms. Badran also indicated that one of the progressive tax’s advantages is that it promotes further investment and helps fight corruption. However, it affects some specific sectors mainly the telecommunications and mining, but more so with respect to big businesses. Badran warned that increased tax leads to tax evasion, and here comes the role of the e-government to resolve such an issue.  

Based on a suggestion from Dr. Talal Abu Ghazaleh, the EPDF Executive Committee decided, to establish a specialized committee at the Forum that will be responsible for the taxation file under the chairmanship of Ms. Badran, with Dr. Ali Al Madadha as vice chair. In addition, a paper on taxation and its effects on all segments shall be prepared for a seminar on the subject at a later date.

On the other hand, EPDF President discussed the idea and stressed the importance of the Jordanian Economic Charter in supporting and reinforcing the economic development, emphasizing that the target now is to establish a standing institution for the Charter to develop policies and to form a working follow up team to ensure the implementation of such policies.

At the meeting, Mr. Nabeel Al Talhouni talked about the arrangements reached with Al-Rai Center for Studies to organize the “Education for Employment” seminar, which is scheduled to be held on November 18th, 2012. The speakers and topics were all decided.
In addition, it was decided to announce the “Integrity and Transparency report” on October 4, 2012 in a press conference with the participation of Dr. Abu- Ghazaleh, Dr. Hisham Al Gharaibeh, Dr. Mohyi Aldeen Tooq and the report’s work team.

One of the other issues tackled was forming a work team for the preparation of the Forum’s annual general report and the issuance of a monthly e-bulletin to follow up on the most important laws approved and promulgated in the Kingdom.
Furthermore, Dr. Al Gharaibeh was assigned to study the establishment of a competitiveness center with the Ministry of Planning.