The International Monetary Fund, Kuwait, called for the implementation of a reform package that includes taxation and a gradual reduction of support amounts to bridge a large budget gap.
According to the fund, the delay in financial reforms will further exacerbate financial needs, while slow progress at the structural level will slow growth, as the economy of Kuwait recorded a growth of only 0.7 percent at the end of last year, while the International Monetary Fund expected a Kuwaiti growth by 1.2 percent end of this year.
In case Kuwait does not undertake the required reforms, the IMF expects that the government's financing needs will increase rapidly, to reach $180 billion in the next six years. The fund called on the Kuwaiti government to follow the example of Saudi Arabia, the United Arab Emirates and Bahrain in imposing a value-added tax of 5% on commodities and expanding the profit tax on local companies.
The Fund announced that, in order to gain broad support, the proposed financial measures should be part of a comprehensive reform package that promotes private sector growth and employment reduces waste, improves the quality of public services, and enhances government accountability and transparency.
Source (Al-Arabiya.net website, Edited)
