Lebanon's 2025 draft budget lacks significant reform indicators, focusing instead on estimating expenditure without addressing the broader objectives, an article posted on Al-Modon news website revealed. 

The proposed revenue model relies heavily on tax amendments, aiming to secure greater resources for the treasury than in 2024, without introducing new financial streams. Thus, the 2025 budget continues to rely on regressive taxation policies, placing the heaviest burden on Lebanon’s most vulnerable citizens while offering leniency to wealthier groups and businesses. 

Though the 2025 budget does not introduce new taxes, it significantly increases the tax burden through adjustments to existing levies, the article pointed out. These modifications have led to tax hikes that, in some cases, have multiplied rates dozens or even hundreds of times. Overall, the average increase in taxes is reported to be 33% higher than the 2024 budget.

According to sources within the Ministry of Finance, the draft budget is designed to protect vulnerable social groups, particularly low-income earners, by not introducing new taxes and adjusting how existing ones are calculated. However, the Al-Modon report highlights discrepancies between these claims and the budget figures, showing that both direct and indirect taxes are expected to generate a significant portion of government revenue.

Direct taxes, such as income tax, maritime property fees, inheritance taxes, and real estate fees, are generally considered fairer because they are tied to the taxpayer's financial capacity. In contrast, indirect taxes—like value-added tax (VAT), fuel taxes, and excise duties on tobacco and vehicles—affect consumption and place an unequal burden on society, particularly on low-income groups.

According to the article, the budget forecasts that direct tax revenues will account for only 17% of total revenue, while indirect taxes are projected to bring in 66%. This disparity underscores the regressive nature of the proposed tax system, which disproportionately impacts Lebanon’s poorer citizens.

The article criticizes the Lebanese government for allowing the burden of taxes to fall heavily on employees and low-income earners, while tax evasion and customs avoidance continue unchecked. Furthermore, the budget maintains a "zero-tax" policy on maritime properties and offers tax exemptions to capital owners and businesses, ostensibly to compensate for challenges faced during the summer due to the ongoing conflict in southern Lebanon.

The 2025 draft budget projects an increase in revenues from 308 trillion Lebanese pounds to 427 trillion, with the bulk of the increase—equivalent to 1.325 billion U.S. dollars—coming from tax adjustments. Among the notable changes, the financial stamp fee has increased from 500,000 pounds to as much as 3 million pounds.

Additionally, the budget introduces a new fee structure for government receipts. Payments issued by the Lebanese government, public institutions, municipalities, and other public entities will incur a 100,000 Lebanese pound fee for receipts issued in local currency and $2 or €2 for receipts in U.S. dollars or euros. Telecom bills, including phone and internet services, will also carry a 100,000-pound fee.

Meanwhile, Article 21 of the draft budget eliminates fees on certain entertainment activities, including arcade games, video poker, billiards, and bowling, which were previously subject to annual levies. The General Directorate of General Security will see a rise in fees for the services it provides, further contributing to the projected revenue increase.

Under Article 17, the draft budget obliges employers to withhold taxes on wages and salaries paid to employees and remit these amounts to the treasury every three months. Taxes on wages paid partially or fully in foreign currencies will be calculated by converting the salaries into Lebanese pounds based on the Central Bank’s exchange rate at the end of each month. While end-of-service indemnities paid before December 13, 2023, will not be affected, the calculation of these benefits remains linked to the pre-2019 system. This effectively reduces their real value by up to 95%, a consequence of Lebanon's ongoing currency collapse.