To counter the “foreign diktats” of the International Monetary Fund (IMF), Tunisia’s President Kais Saied has suggested taxing the wealthiest citizens of the nation.
Even though a nearly $2 billion bailout package was reached in principle last October, negotiations with the IMF have stalled for months due to demands to restructure public institutions and end subsidies on essential goods.
Using a quotation attributed to Omar Ibn Al-Khattab, the second caliph of Islam, President Saied proposed the idea of “taking surplus money from the rich to give to the poor” during a meeting with Prime Minister Najla Bouden on Thursday.
“Instead of lifting subsidies in the name of rationalisation, it would be possible to introduce additional taxes on those who benefit from them without needing them,”Saied suggested, noting that he believed such a mechanism would prevent the nation from caving in to foreign lenders.
The “bankruptcy of the state,” according to Tunisia’s Finance Minister Siham Nemsieh, would result from loan default.
Meanwhile, an agreement for Tunisia to receive a loan from the African Export-Import Bank worth $500 million was approved by the country’s parliament, which was announced by Tunisia’s parliament on Thursday.
Out of 154 votes cast, 126 were voted to pass the agreement.
Nemsieh said borrowing had become unavoidable due to outside factors such as the COVID-19 pandemic and the war in Ukraine, in a speech during the session.
According to data provided by the ministry during the session, Tunisia’s debt will have risen to about $37 billion by the end of 2022, or 79.9 percent of its GDP.
Soaring inflation and the global increase in food prices have particularly worst-affected the poor.
According to official statistics, the unemployment rate increased to 16.1 percent in the first quarter of this year from 15.2 percent in the fourth quarter of 2022, and inflation in May reached about 10.01 percent.
Since the uprising that ousted longtime ruler Zine El Abidine Ben Ali in early 2011, Tunisia has experienced a decade of economic stagnation.
The country’s public finances have not been significantly improved by the $1.7 billion in 2013 and $2.8 billion IMF loan agreements in 2016.
Source-Aljazeera
