Waste crisis or new tax? Lebanon’s environmental fee raises questions

Report by Bassam Abou Zeid, English adaptation by Karine Keuchkerian

About $185 million a year is the estimated cost of solid waste management in Lebanon. But instead of asking how to reduce that cost and turn waste from a burden into a productive sector, the government has opted to collect a large share of the funds from Lebanese citizens.

On June 15, the Cabinet approved imposing a 1.5% environmental fee on a wide range of imported goods. The decision would have affected many products, potentially paving the way for a new wave of price increases. 

As objections mounted, the Finance Ministry backed down from imposing the fee on most of the targeted goods and limited it to 26 types of imported goods, including alcoholic beverages, tobacco and perfumes.

But the rollback was not complete. A closer look at the fee schedule shows that the rate increased from 1.5% to 3% on alcoholic beverages, tobacco, cars and watches, and to 2% on leather and fur products. The reason? To make up for part of the revenue the Treasury would lose after removing a large number of goods from the list.

Customs authorities will immediately begin collecting the fees for the Treasury, with expected revenues ranging between $90 million and $120 million annually. The funds are supposed to contribute to addressing the waste crisis.

But this is where the questions begin: Under what plan will waste be managed? Where is the sustainable waste management plan? Who will oversee how these funds are spent? And who will ensure that the revenue actually goes to the waste sector rather than being absorbed into other areas of government spending?

Most importantly, why should Lebanese citizens pay tens of millions of dollars every year to manage a sector that should, if properly managed, be able to recover part of its costs through sorting and recycling?

Years of plans, contracts and temporary solutions have passed, yet waste remains a crisis, and costs continue to rise. Today, instead of first presenting a clear, transparent and accountable plan, the government is imposing the fee before providing a solution.

And the problem does not stop at the value of the fee. In Lebanon, any new import fee can translate at the market level into a price increase greater than the actual value of the fee. The trader raises prices for the distributor, the distributor raises them for the retailer, and ultimately, the consumer pays.

Even goods that are not subject to the fee could be swept up in the price increases, with prices rising under the claim that “fees have gone up.” 

Amid a waste crisis that the government has yet to solve sustainably, and a new fee that is supposed to finance that solution, the question remains: Will the environmental fee mark the beginning of a genuine effort to address Lebanon’s waste crisis? Or will it simply become another source of revenue for the Treasury, and another bill for the Lebanese people?