Businessmen continue protest against sales tax [Archives:2007/1029/Front Page]

March 1 2007

By:Yemen Times Aden Bureau
ADEN, Feb 28 ) Many merchants and businessmen in Aden expressed their resentment to new amendments in the sales tax law, confirming that they will continue their strike unless and until something is done in this matter.

Ahmed Hadi Salem director of the Chamber of Commerce in Aden stated that businessmen will continue the strike while closing their shops and retail outlets in several districts of Aden in protest against the regulations in the sales tax law, which they feel, are harming their businesses.

“Heads of the Chamber of Commerce offices around the country met with the Prime Minster Abdulqadir Bajamal and demanded change in the applied taxes recommending the government to invite an internationally renowned organsiation specialized in taxes to study the current taxation system in Yemen and suggest alternatives that would solve the business sector's problems with regards to this matter. However, the government did not appreciate our recommendation and nothing was done about it,” said Salem emphasizing that the private sector is ready to abide by any laws so long as they allow reasonable returns to the sector.

According to Mohammad Hassan Al-Zubairi chairman of the Yemen and Gulf Bank, the sales tax is a method for limiting purchase price hikes, and which is enforced by the International Monetary Fund and World Bank. “Consequently, the end prices for the consumers will increase and so the purchase power will decrease and the poor would become poorer,” he added. However, Al-Zubairi commented that businessmen reject some of the sales tax regulations because it will oblige them to allow tax personnel to visit them regularly for tax collection and inspection.

“The state should focus on ports and entry points to the country and work the new sales tax law gradually in a way that does not affect the citizen or the private sector negatively,” he concluded.

The private sector in Yemen has been pressurizing the government for the last few weeks to reconsider its actions and invest more in infrastructure and facilitation of investment. Although the tax authority has broadcasted advertisements explaining that only large businesses will be affected by the tax and advised them not to be misinformed or manipulated by larger businesses as most merchants who went on strike will not be affected by the tax law.

Previously last month, hundreds of Yemeni businessmen, investors and merchants congregated at the Sana'a Chamber of Commerce in solidarity with Yemeni businessman Jamal Al-Mutareb who was subjected to a harsh media campaign from September 26, the official newspaper of the Yemeni armed forces. Al-Mutareb expressed his fears of the consequences for the government's policies related to economy and investment with specific reference to the General Sales Tax.