Hodeidah Chamber of Commerce Analyzes the Sales Tax Law Draft [Archives:2001/21/Business & Economy]
Chairman of Hodeidah Chamber of Commerce, Mr. Abubaker Shamakh, criticized the sales taxation law draft and described it as imbalanced, demanding the government postpone issuing it. He clarified how the project would result in doubling prices if the proposed taxes of 25%, are implemented in the case of cars, and 45% if the proposed taxes are 10%.
In its analysis of the law draft, the Hodeidah Chamber of Commerce and Industry clarified the potential anomalies that would lead to price acceleration. The proposed sales taxation project hasn’t been issued yet. To highlight its items, Yemen Times is publishing the summary of the analysis below:
The project analysis
The implementation of the project, at one stage would have a heavy impact on customers.
HCC included in its report an example of cars selling prices. A car that costs C.I.F YR 2 000 000 would have to be sold to customers at YR 4 431 281. This is after adding consumption tax (25%) + profits and other profits (3%) + trade profits (10%) + sales profits (25%). The total exceeds 100%!
The report also criticized how the sale taxation stated as 25%, actually becomes 45% and thus, negatively affects customers and decreases the state revenues of taxation and customers as a complete cycle. Legal defects, as HCC’s report, stated, appear here and there presenting a lot of confusions.
The sales taxes project, according to HCC’s analysis, obliges the importer to pay the proposed taxes in advance. The report demanded that the government reconsider the proposed project, consider people’s consumption as well as freeing of the draft from contradictions and legal defects.