New mechanism for declaring taxes on dollar salaries for 2022

Lebanon Economy
2022-12-29 | 09:14
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New mechanism for declaring taxes on dollar salaries for 2022
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3min
New mechanism for declaring taxes on dollar salaries for 2022

The issue of taxes on income in dollars is on its way to a solution.

 

The authorities have devised a new mechanism for calculating taxes, which protects the employee and secures revenues for the state treasury.

 

According to the previous mechanism, which was subject to criticism, for example, if an employee receives a salary in dollars at the rate of $1,500 per month, he pays a quarter of his salary as income tax on the current exchange rate, 38,000 LBP to the dollar, it would be equivalent to 171 million Liras annually.

 

After the efforts made by the private sector, a new mechanism was reached as a temporary solution to collect taxes for the year 2022, for revenues in dollars in whole or in part, until the Ministry of Finance comes up with a new mechanism to be issued in the next year’s budget, and based on which the income tax for the year 2023 is calculated.

 

According to the new mechanism, for 2022, the tax is calculated on the exchange rate of 8,000 Liras to the dollar for the first ten months of the year that preceded the issuance of the budget, while the tax is calculated on the exchange rate of 15,000 Liras to the dollar for the last two months.

 

Thus, for example, the total taxes for an employee earning $1,500 are as follows:

 

- 13,200,000 LBP for the first ten months

 

- 4,950,000 LBP for the last two months

 

The total yearly taxation would be 18,150,000 LBP for the year 2022.

 

Once again, the private sector finds itself facing a problem caused by the economic and financial crisis and government agencies at a time when it has been striving since the beginning of the crisis to find solutions, and it managed. At the peak of the economic downturn, the private sector supported in achieving growth in the economy of nearly 2 percent.

 

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