The Finance Ministry has announced that businesses that were forced to close temporarily due to damages sustained by Beirut’s port blast will be exempted from income taxes for three years.
The exemption will apply for 2021, 2022, and 2023, the state-run National News Agency reported.
Thursday marked six months to the Beirut Blast that completely destroyed 70 percent of the buildings and lively business districts near the port, and caused the death of more than 200 people.
The residents were already dealing with a collapsing economy before the deadly blast wrecked a huge number of businesses.
According to Mercy Corps, an international humanitarian organization, small businesses represent 97% in Lebanon and are mostly family-owned. They also act as a lifeline for local residents, providing jobs, income, and stability.
George Antoun, Mercy Corps Former Country Director for Lebanon, had previously stated that 51% of people in Lebanon rely on small businesses for their livelihoods.
For many helpless families in Lebanon, if they don’t work, they don’t eat, which only brings us to question if this exemption is of enough assistance.
Back in September, the Lebanese president, Michel Aoun, signed a decree allocating 100 billion Lebanese pounds (about $12 million on the black market rate) to a compensation program for the tens of thousands of homes and businesses that were destroyed,
The presidential move came after weeks of criticism regarding the inertia of the Lebanese government to act.
Beirut’s Governor, Judge Marwan Abboud, estimated that the total losses reached nearly $15 billion, local media outlets reported.
A direct assessment of the damages by the army reported that the blast damaged almost 61,000 homes and more than 19,000 businesses. The allocated funds of $12 were nowhere enough to cover all the areas.
The exemption of income taxes, which should be logically applicable as of August 4th, 2020, indicates that these Blast-impacted businesses are not expected to make up for their losses and be back to a healthy level of income before 2023.
Moreover, with a sinking local currency and the alarming hyperinflation, combined with the unhelpful neverending political bickering over the formation of a government, it will take more than a tax exemption for these businesses and all across Lebanon to get back on their feet.