No Taxation without Representation? On Tax Reforms in Jordan

…Secondly, the government should fight corruption, tax avoidance (which according to the Income and Sales Tax Department in 2016 cost the budget JD 3 billion), mismanagement, and cronyism to make Jordanians feel their taxes are being put to a good use. One study, conducted by the University of Jordan Strategic Studies Center and NAMA Consultants, argues that only 35% of Jordanians have a positive view on how the governments serves the people, a steep decline from 65% in 2011. Even larger number ­– 79% of the population according to Arab Barometer — believe state institutions are corrupted, and consider economy and corruption their biggest worries. This is confirmed by Jordan’s ranking in 2017 Transparency International’s Corruption Perceptions Index — 59th position among 180 countries. An illustrative example of how big of a problem corruption in the country is might be the recent cigarette scandal involving accusations of local authorities granting tax exemptions to a businessman owning a number of unlicensed cigarette manufacturing plantsall over the kingdom, which — according to whistle-blowers — may have cost the budget a loss of over JD 150 million. If Jordanians are to accept tax increases, they need to trust that no one is able to escape making a contribution just because they have wasta (good connections).

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