VAT was introduced in late 2001 and became effective in the beginning of February 2002. It accounted for 23.3% of all tax revenues in 2002, a percentage that rose to 34.2% in 2012 thus becoming the largest source of state income.

The tax on business profits stood in 2003 at LBP 625 billion, forming 13.3% of the total tax revenues. It rose to LBP 1160 billion in 2012 accounting for only 10% of revenues. A corrective measure must be taken to hike the business profits’ tax rates to become the primary source of funds, given that this type of taxation targets the highest-earning class, not all the Lebanese.

The new tax imposed pursuant to Article 51 of the 2003 draft budget law on interest-generating bank deposits is now responsible for 10% of tax revenues. Its rates can also be pushed from 5% to 7% for further contribution to tax income.

Despite the backlash against the encroachments on coastal property and the talks about the substantial income that the state may generate by settling these encroachments and collecting annual occupation fees, the estimated revenues did not exceed LBP 30 billion annually, while talks suggest more than LBP 300 billion in revenue if the law is to be enforced strictly.

In 1992, imports duties stood at 45.2% and rose to LBP 61.3% in 1999. These rates plummeted again with the introduction of VAT, reaching 7.5% in 2012, which can jeopardize the present and the future of the Lebanese industry.

Source: Budget laws and draft budget laws in the respective years. These are the tax revenue estimates but the actual figures might be either higher or lower