ECONOMY

Will 2018 be the year of high prices in Jordan?

The Jordanian cabinet approved the public budget law project and the budgets of government unit’s law for the fiscal year 2018. (Shutterstock)

Economic experts have agreed that the general budget of Jordan for next year will depend on canceling of tax exemptions and customs duties applied on goods and lifting subsidies on bread, which may raise prices, while increasing the sales tax on a large number of processed food.

Experts pointed out that these measures will necessarily lead to high inflation rate and a decline in the standard of living, noting that the fiscal deficit is still more than one billion dollars high after the calculation of foreign fund, according to the “Middle East” newspaper.

On Monday, the Jordanian cabinet approved the public budget law project and the budgets of government unit’s law for the fiscal year 2018, in preparation to deliver it to the parliament for their approval as per the constitutional procedures.

The main features of the budget project were that the revenues were estimated with at KD 8496 million (USD 11.98 billion), distributed by JD 7796 million ($ 10.99 billion) for local revenues and 700 million dinars ($ 990 million) for external grants.

Khalid al-Zubaidi, an economical expert, said that what distinguishes the new budget is that 98 percent of public revenues are covered by local revenues, instead of 92 percent for the 2017 budget.

“The increase in domestic revenues means that there is an increase in tax and a cancellation for the subsidies, so as a result of this a wave of high prices will hit Jordan next year,” he told the “Middle East” Newspaper.

He clarified that this is the first time for the revenues to reach that level, the capital expenditures were lower than last year, and there is an increase of expenditures that gives the impression that the Government is unable to control its expenditures.

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Last Update: Tuesday, 21 November 2017 KSA 18:56 - GMT 15:56
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