Tunisia will not impose new taxes in 2019: prime minister

Tunisia will impose no new taxes on individuals and firms under the 2019 budget but will continue to reform a costly subsidies system, Prime Minister Youssef Chahed said on Friday. (AFP)

• The IMF has been pressing Tunisia to trim its budget deficit and increase fuel and electricity bills.
• The IMF and Tunisia reached an initial, or “staff level,” agreement last month on the next reforms, the IMF has said.

TUNIS: Tunisia will impose no new taxes on individuals and firms under the 2019 budget but will continue to reform a costly subsidies system, Prime Minister Youssef Chahed said on Friday.
The country has struggled to fulfill donors’ demands to reform its economy and cut its budget deficit amid turmoil since the ousting of president Zine El-Abidine Ben Ali in 2011.
Unwilling to cut a bloated public service due to resistance from labor unions, the government has raised taxes several times, prompting riots for weeks in January.
“To boost growth and to make companies more competitive we will not impose new taxes on companies or individuals,” Chahed said in a speech. But he added that the government would continue to overhaul the subsidies system which is straining public finances.
Tunisia raised fuel prices this month by about 4 percent, the fourth increase this year.
The cost of fuel subsidies this year will rise from an expected 1.5 billion dinars ($542 million) to 4.3 billion dinars due to the rise in world oil prices, officials have said.
The IMF has been pressing Tunisia to trim its budget deficit and increase fuel and electricity bills.
Chahed, who is fighting for survival as some in his Nidaa Tounes party and labor unions have tried to oust him, vowed to go ahead with unpopular decisions.
“Despite ... the lack of political support for the government we will go ahead next year with reforms including welfare contributions and subsidies,” he said, without giving details.
The IMF and Tunisia reached an initial, or “staff level,” agreement last month on the next reforms, the IMF has said.
The Washington-based fund is due to decide whether to pay out the next loan installment worth $250 million, part of a $2.8 billion scheme, at a board meeting this month.