“National Bloc”: We Refuse Any Tax Increase on Citizens… Trust is the Key to the Solution through Anti-corruption, Administrative and Taxation Reforms

The “Lebanese National Bloc Party” affirmed its refusal to any tax increase on citizens. It called for fairer redistribution of tax rates, stressing on the need to restore trust through measures centered on fighting corruption and reforming public administration. The Party went to the "economic meeting" set to be held in Baabda with a list of possible and feasible solutions based on the will of the ruling class and on the citizens’ demands.

The party pointed out that ensuring trust is the first condition in the construction or revitalization of any economy in crisis. The Party denoted that trust is missing from Lebanese and foreign investors and private sector clients at all levels. This trust is missing in the state’s capacity and in the ruling class to provide the favorable investment climate. The Party noted that Lebanon is ranked 123/137 globally for corruption, and recalled that according to global statistics, the rate of corruption among all countries is estimated at 5% of national income; given the above classification, the rate of corruption in Lebanon can be estimated at 10% under reserve, which is an equivalent of $1 billion a year, more than the total salary of employees representing a third of the public budget.

To restore trust, the first steps and measures taken should be:

  1. Establishing the National Anti-Corruption Commission and ensuring its independence.
  2. Implementing the study prepared by the Ministry of State for Administrative Reform (OMSAR) to achieve this goal.
  3. Establishing the “Electricity Regulatory Authority” and ensuring its independence.
  4. Customs administration reform.
  5. Implementing the mechanism of "e-procurement" in the Parliament (electronic tenders).
  6. Issuing the implementing decrees of the "Access to Information" Law.
  7. Increasing the budget of all oversight bodies, from the Central Inspection to the Audit Bureau, the Customs Administration and the Constitutional Council, and increasing their staffing that is insufficient to control 30% of the labor force in Lebanon.
  8. Immunizing these regulatory agencies from any political interference by giving a committee that is technical independent of "parties-sects" and far from the clientelism logic that prevents accountability, the task of appointing judges and employees.
  9. Implementing the decisions of the oversight bodies without any equivocation.

The Party considered that all the solutions suggested are feasible, but depend on the real intention and will of the ruling class to fight corruption and stop waste on one hand, and the citizens’ determination and demanding of these measures on the other.

With regard to public administration, the Party pointed out that the rate of its employees constitutes 30% of the labor force in Lebanon, while it does not exceed 18% in the producing countries; and Lebanon’s administration productivity rank is 124/137 globally.

The party pinpointed that the high number of employees and their lack of productivity is not the responsibility of the employees but the "parties-sects". The system of these parties, their corruption and their political and clientelism feudalism have destroyed the economy and compensated the unemployment by indiscriminate employment without taking into account the required efficiency and the possibility of holding accountable the leaders’ followers in the administration. These parties have held the poor people in owning situations and have exploited them by providing them a job.

The Party believes that the government should apply the electronic management system concluded by OMSAR; noting that this measure will increase the administration’s productivity by at least 20%. This would reduce the cost of any paper work by 80%, not to mention the immediate and automatic reduction of corruption. The Government completed the comprehensive study on the status of public administration and was approved by law on 21 August 2017.

The Party called for the implementation of the continuous training system and recruitment according to one criterion: efficiency. Although our sectarian system requires - at a certain level – equality in in some positions, it does not prevent that the assignment be done by appointment commissions completely independent of "parties - sects."

The Party stressed that employees should be empowered against any political interference by mobilizing the judiciary system and protecting the employee. As such, occupying a public position will be a pride to the employee and an honor of serving the country instead of being an owning and humiliation.

On the tax policy level, the Party confirmed that the taxation system in Lebanon is unfair, as 70% of taxes and fees are indirect and affect primarily the middle class and the poor. In addition, tax rates must be redistributed to be fairer.

As for the leaking of painful measures, which of course will only be an increase of taxes and fees affecting the citizens, the Party stressed that this is surprising and unacceptable.

The Party explained that on one hand, the axiom of the economy confirms that the increase of taxes and fees during recessions and under a deflationary budget increases this recession. Relying on the intended investments from CEDRE loans threatened by the state’s capacity to fulfill its promises on reforms will not be effective before two or three years.

On the other hand, in the case of economic recession and high unemployment, instead of increasing taxes and fees on the middle and poor classes, the rate of service coverage should be increased. The Party noted that the social safety net budget in Lebanon is the lowest in the MENA countries and constitutes only 1% of the budget; only a fraction of the cost of corruption, estimated at $ 5.6 billion a year, is enough to expand the network.

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