New flat fee imposed
on businesses and the self-employed

Not deductible from taxable profit

The Ministry of Finance (MoF) will levy an annual flat fee on all types of business activities, including companies and the self-employed.

The fee is imposed on the headquarters and the branches of both stock corporations and partnerships. The MoF’s decision defines the ‘branch’ as a location where the taxpayer carries out their activities or receives their clients.

The fee is not deductible from profit subjected to income tax.

According to the MoF decision, the fee will stop being imposable one year after a company has completely stopped its operations or a branch is permanently closed.

The fee must be paid each year before the end of September. It can be paid through banks, LibanPost, OMT, or through any other company that concludes an agreement with the MoF for this purpose. Payment could also be done electronically.

Taxpayers who have paid the fee must post the receipt in a visible location on their premises. If they fail to do so, they will have to pay a fine equivalent to the amount of the fee.The fee was originally called ‘professional tax’ and was part of the draft budget of 2000 but it was never applied. At that time the government expected to collect nearly LL50 billion (around $33 million) through the fee. The tax was revived through another law issued last year.

FEE RATES
Joint stock companies (SAL): LL2 million ($1,330).
Limited Liability companies (SARL): LL750,000 ($500)
Partnerships and sole traders who are taxed on real profit: LL550,000 ($365)
Individual taxpayers who are taxed on lump-sum profit:LL250,000 ($166)
Taxpayers who are taxed on estimated profit: LL50,000 ($33)