What To Do?!

By: Mohammad Aburumman

تم نشره في Tue 7 June / Jun 2016. 07:42 PM
  • Mohammad Aburumman

In spite of his attempts to remain positive and active in addressing challenges and facing up to them, particularly financial and economic ones; Prime Minister Hani Mulqi’s cabinet team, especially the Minister of Finance, are aware of the scale of the financial predicament and the difficulty of choices laid out even during negotiations with the International Monetary Fund (IMF) and their terms regards water and electricity, basically.

What could be achieved off negotiations with the IMF, is discontinuation on deficit accumulation. But with this more or less sedative procedure, and the fund having finally recognised the difficulties in the Jordanian financial equation; between an overly inflated sum of current expenditure and limitations on resources, considerations in regards to electricity and water reiterate, as well as to Income Tax procedures; under the basic assumption that 98 % of Jordanians do not pay income tax!

Not to argue prior assumptions, but obviously our options are limited. Eyes look out for the premises of the new phase led by the establishment of the Investment Fund and the Jordan-Saudi meet to start off the rested wheel of investment, given Jordan’s very low current growth rates; in order to allocate liquidity and jobs to contain the rising average of unemployment, at 14 per cent in total and 30 per cent among youth, comprising a real, fundamental threat to social security and domestic, civil peace.

The Minister of Planning is still optimistic about the outcomes of the London Donors Conference, and that something can indeed be achieved of it. Similarly, the Ministry of Education state that the first bundle of grants to build schools have arrived, which is a good indicator, to help alleviate the weight of the Syrian refugee crises on national economy and infrastructure. However, the ceiling of expectations in regards to the outcomes of the Conference have declined now from its levels back then in London.

In light of this, it becomes crucial that we ask today, really; What to Do?! Domestically, how can we rely on ourselves more to face up to financial crises and the lingering shadow of unemployment and poverty?! Is it even possible given the scarcity of resources and high current spending, coupled with reinterring partialities that drain the general budget?!

There is no other option; there is nothing to do but to reform the domestic economic and financial situation, on both short and long terms, as well as addressing unacceptable and unreasonable imbalances in our taxation systems and our consumerist approaches to education and labour market management.

According to official estimates, 98 per cent of Jordanians do not pay income taxes. This figure requires considerable explanation and elaboration, of the apparent official disinterest and dismissal of the Sales Tax issue, as well. Despite the importance of this issue, there are other matters that supersede it; mainly the shortcoming of consecutive governments in addressing the massive scale of tax evasion, particularly among doctors, companies, traders, and businessmen. There estimates that the budget loses somewhat between JOD0.5-1 billion annual because of this.

The income taxation operation needs to be reviewed legislatively, administratively, and capacity-wise, to empower and enable its instruments of collecting and penalising evaders.

Take the labour market, for instance; to have this rate of unemployment at this level is inacceptable, especially since we have 700 thousand foreign labourers and several sectors theoretically open to all, while our officials argue the taboo culture to justify their failures. Had work conditions and qualifications been good, the situation would be different.

Dozens of examples could be made on the importance of getting our own house in order; electricity waste and lowering government spending could ground realistically for a different future, as well as different relationship between State and citizenry.