No new taxes in Tunisia budget

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Tunisia’s parliament approved a 2019 budget imposing no new taxes on individuals and easing the burden on some sectors after years of tax hikes that stoked public anger and at times violent protests.

The budget, adopted by 113 votes out of 217, projected a drop in the deficit falling to 3.9% of gross domestic product in 2019, from about five percent expected this year.

Prime Minister Youssef Chahed said earlier this year 2018 would be the last difficult year for Tunisians and government remains under pressure from the International Monetary Fund to trim the budget deficit by cutting subsidies and reforming the bloated public sector.

Next year’s budget expects Tunisia’s economy growing by 3.1%, up from an estimated 2.6% this year.

Government will halve tax for companies operating in sectors including technology, textiles, engineering and pharmaceuticals to 13.5% .

The 2018 budget raised taxes on cars, alcohol, telephone calls, the internet, hotel accommodation and other items to help balance the books.

Taxes on bank profits were raised to 40 from 35%. Government also raised by a percentage point value-added tax and imposed a new one percent social security tax on employees and companies.