MoF to appoint private tax collection firms

Interested firms should have $3.4 million in capital or more, 100 employees, and 24 local offices

The Ministry of Finance (MoF) aims to hire more private firms to collect taxes and fees on behalf of the ministry. The MoF issued a decree stipulating the requirements that need to be met by companies interested in collecting taxes and fees on behalf of the ministry.

“(The decree) aims to reduce the cost of tax payment services by allowing competition among private firms,” said Ahmad Kaouk, head of the Tax Collection Division at the MoF. The ministry has been looking to increase tax revenues by upgrading and automating tax collection systems.

Tax collection services are currently offered by banks and two private firms: Liban Post and OMT (Western Union). The decree excludes banks and Liban Post, which were assigned to collect taxes in the 2008 Tax Act, adopted by Parliament. “The decree did not exclude OMT because unlike the 72 local banks and Liban Post, OMT was assigned through an agreement signed with the MoF one year ago,” said Kaouk.

As per the decree, companies offering tax collection services should have a minimum capital of LL5 billion ($3.4 million). They should also employ at least 100 employees, and they should be registered at the National Social Security Fund (NSSF).

The decree stipulated that such companies should have branches, or offices, in all the country’s governorates (Muhafaza) and provinces (Caza).

“The decree encompasses the collection of all kinds of taxes, including income tax, property tax, and VAT,” said Kaouk.

The MoF will consider qualified applicants and select the most eligible among them. “The ministry will sign memorandums of understanding with the companies selected and will set fees these companies are allowed to charge in return for their services,” he said.

According to the decree, tax collection firms should have a call center, as well as other pertinent technologies to ensure reliable customer service.

“The MoF may assign two or more companies, but this is subject to negotiations according to the ministry’s vision and considering (each company’s) qualifications,” said Kaouk.

Reported by Abeer Darwiche