The site of an Israeli strike targeting Beirut's southern suburbs as seen from Hazmieh highway on Nov. 13, 2024. (Credit: P.H.B./L'Orient Le-Jour)
Caretaker Finance Minister Youssef Khalil announced Thursday that he has submitted a draft law to caretaker Prime Minister Najib Mikati proposing tax and duty exemptions for individuals affected by Israeli attacks in Lebanon before the Nov. 27 cease-fire brokered by the United States and France took effect. The proposal requires approval from both the Cabinet and Parliament to become law.
The draft law not only exempts eligible individuals from taxes but also suspends deadlines for various tax obligations starting Sept. 1, 2024, according to one of its 15 articles shared by the minister. Notably, the legislation includes a provision for the state to cover social security contributions owed by affected taxpayers in 2024, though it remains unclear how this measure will be financed.
To qualify for these exemptions, taxpayers would need to provide evidence of direct damage to individuals or property, including buildings, vehicles or other assets, if the law is enacted. Assessments conducted by the army on destruction and human losses will determine a taxpayer's eligibility. In theory, owners of homes targeted by Israeli bombings for assassinations could benefit from these tax adjustments.
Khalil justified the proposal by highlighting “the massive damage inflicted on industrial, commercial, non-commercial and independent businesses, residential and non-residential buildings, as well as vehicles.” The war, which has claimed 4,000 lives since Oct. 8, 2023, has largely resulted from heavy Israeli bombardments targeting civilian areas in Beirut’s southern suburbs, southern Lebanon, and the Bekaa Valley.
Khalil, a former BDL executive and member of the Amal Movement led by Parliament Speaker Nabih Berri, expressed hope that the draft law would be reviewed at the next Cabinet meeting. The proposal comes as the adoption process for the 2025 budget remains stalled. Khalil had rushed to submit the budget to Parliament earlier in September, theoretically allowing it to enact the budget by the end of January.
A November World Bank report estimated that Israeli bombardments caused at least $3.4 billion in damages and $5.14 billion in economic losses. These figures do not account for strikes conducted between Oct. 27 and Nov. 27, many of which occurred without warning. On Wednesday, the Cabinet approved the terms of reference for tenders to oversee debris removal and damage assessment.