Minister of Finance defends 2012 budget plan: VAT revenues will benefit low-income families
The Minister of Finance Mohamad Safadi slammed the critics of the 2012 budget draft. He said that politicians protesting the plan have misled the public.
Critics of the budget draft complained the increase of the Value-Added Tax from ten to 12 percent, and a LL2,000 increase to the price of gasoline.
Safadi denied that the budget plan included imposing an increase on the price of gasoline. He said that “the issue is out of question,” and that it is in the context of “political fabrications.”
The Minister of Finance defended the two percent raise to the VAT. “Revenues from the VAT increase will benefit the low-income individuals,” he said.
According to Safadi, the VAT increase would introduce additional LL550 billion in revenues. “We’ve allocated LL300 billion from these revenues as an additional budget to the Ministry of Public Health so that it would provide full coverage for all citizens,” he said. He also said that the remaining funds were allocated as a direct subsidy on the living costs for low-income families.
Safadi said that he is ready to cancel the proposed VAT increase from the budget plan “if politicians do not want any increase (in state revenues) that would provide a total health coverage system and a subsidy for low-income families.”
Date Posted: Oct 13, 2011