Malhas: The Introduction of "Financial Investigations" and the Shift of Tax Evasion Penalty from Misdemeanor to Felony
5/7/2018 1:54:22 PM
H.E. Finance Minister, Omar Malhas, said that half of the main features of the income tax bill are tackle the issue of combating tax evasion and improving tax collection, as well as optimizing the use of technology to combat tax evasion.
H.E. stressed that the pivotal role of the Financial Investigation Department, which will be developed to operate with high technology to help fight tax evasion.
The Minister said during his participation in the Jordanian Economic Forum on Wednesday that dealing with taxpayers will be based on good faith and nothing else, where there are articles in the draft law to "turn the page" with taxpayers.
The Minister of Finance explained that the fight against tax evasion requires concerted efforts and this also requires the imposition of penalties in the new draft law and deal with the crime of tax evasion from describing it as a misdemeanor to a felony, and about tax revenues, H.E. said that 70% of treasury revenues come from indirect taxes and this is an Inverted pyramid case where it should be the other way around and this needs time.
H.E. reviewed the stages of the management of financial policy in Jordan, stressing that the dependence on grants passed through different stages. The average ratio of grants to GDP were about 7% 3 decades ago, and was about 22% in 1979. H.E. also pointed out that the pattern of government spending was not Based on total tax revenues as a basis for spending. Then, grants declined and increased again in 2017, where they constituted only 2.5% of GDP, where the pattern and format of government revenues varied.
Investment wise, the minister pointed out that in order for growth to improve, more investment is needed. Investments will not come if there is no economic stability. He said that economic stability needs financial stability, that there is a successive series of issues that start with financial stability in addition to what Jordan faces the challenges amid rising unemployment and debt levels.