The proposal suggests increasing total public expenditures to $13.5 billion, up 16 percent from 2009. Out of this total figure, the proposal allocates $4.3 billion for debt service, and $1.35 billion for spending on new investments in various sectors, up 148 percent from 2009.
The draft did not include a proposal to raise the Value Added Tax (VAT). It proposes to raise the tax on bank’s net interest income on deposits to seven from five percent, and the same raise on real-estate registration fees worth over $497,000.
It also includes a proposal to waive tariffs on hybrid cars.
The draft sets the government’s revenues at $9.1 billion in 2010, up eight percent from 2009. It says that the public debt will hit the $55 billion mark in 2010, up from $51 billion at the end of 2009.
The proposal suggests an increase in subsidies to social, educational and health institutions by 24 percent to $761 million, including an exemption from registration fees to public schools and official exams.
It allocates $82 million for the agricultural sector, up from $67 million in 2009, and $1.57 billion to Electricite Du Liban (EDL), up 27 percent; it suggests an allocation of $228.2 million to finance road projects, and $86 million to the state owned university- the Lebanese University, and $35 million to develop prisons and buildings of the Internal Security Forces.
The plan also proposes allocating $117 million to finance water projects, and $320 million for power projects.
El Hassan said the budget has set one of main targets as preventing any further increase in the debt to GDP ratio. She said that the government wants better contribution from the private sector in financing investment projects and structural reforms for the economy. "Growth can reach eight percent this year if the long awaited privatization and restructuring plans are executed," the minister said.
The draft budget which will be discussed by the cabinet will need final ratification from the Parliament.
El Hassan has also sent a copy of the proposal to President, Michel Suleiman.