During the last decade, Lebanon recorded climaxing political, economic and regional problems, which have impeded the economic growth and significantly strained its public finances. The huge debt burden, chronic fiscal deficits, the need of urgent structural reforms exacerbated the dire situation. The year 2017 brought major changes in the financial, fiscal and economic development with the approval of a tax hikes package and the passing of the first state budget in 11 years.

The policy paper is analyzing these new tax measures, assessing their impact on public finances and evaluating their effect on economic growth, business environment and investments. Roger Melki comes to the conclusion, that Lebanon’s public finances are projected to remain structurally weak without introducing significant structural reforms. Simple taxation redistribution without a sustainable fiscal policy able to generate a structural change cannot solve Lebanon’s longstanding economic, fiscal and financial deadlock.

The paper is released in Arabic and English.