BEIRUT, June 21 (Xinhua) -- Trade activities in Lebanon are facing a serious problem as dropping by 50 percent in different areas in the first six months of 2018 compared with a year ago, said Nicolas Chammas, head of the Beirut Traders Association.
"The commercial sector is on the verge of collapse and Lebanese officials did not make any effort in adopting the necessary measures to improve merchants' conditions," he said.
Chammas' remarks came during a meeting held Thursday with merchants and different commercial and economic syndicates at the headquarters of the association in Beirut.
Chammas said that the adoption of the salary scale law did not result in an increase in the trade activities in the country as expected.
"On the contrary, this law resulted in an increase in taxes to finance the salary scale which, in turn, caused a drop in people's purchasing power," he said.
Lebanese President Michel Aoun signed last year the salary scale and tax hike laws that increased a number of taxes including a 1-percent rise in the value added tax (VAT) rate.
In addition to the increase in VAT rate from 10 to 11 percent, the law increased taxes on corporate profits, interest of bank deposits and imported alcohol and tobacco.
"The problem is that legal businesses are not only suffering from high taxes but also from competition by illegal enterprises which are not paying any taxes at all," Chammas said.
If this situation continues, he added, the country will witness the closure of over 20 percent of legal business activities in the coming two years.
He called for a quick formation of the government in a bid to ratify a strategy that would save the commercial sector from further deterioration.
