Lebanon scraps import fee hike weeks after introducing it amid price pressures

Lebanon is scrapping the import fee increase it introduced just weeks ago — a reversal that signals how thin Beirut’s tolerance is for tax measures that raise consumer prices in the middle of a fragile recovery. Finance Minister Yassine Jaber signed the draft decree on Monday, with the draft now with Cabinet for its sign-off.

How we got here: Earlier this summer, the Finance Ministry introduced a 2-3% levy on importers meant to boost state revenue and incentivize tax payment. Employers pushed back immediately, saying the measure had been taken without prior consultation. Inflation on imported goods — especially food, which saw 4-5% price rises — set off complaints from trade unions and households. The government suspended the decree by the end of June, pending review.

The pitch on reversal: Jaber framed the decision as a balancing act between protecting public revenues and shielding Lebanon’s industrial sector and jobs. It’s a politically potent framing in a country whose manufacturers have leaned heavily on cost stability to survive the aftermath of the 2019-2020 financial collapse — and a decision that will inevitably raise questions with the IMF, whose long-stalled program hinges on Beirut's ability to sustainably raise revenue.

The fiscal backdrop: Regional military escalation in March pushed the state’s budget deficit to LBP 4.2 bn (USD 46.9k), as expenses jumped 145% y-o-y, according to Blom Invest. That makes the reversal more striking — the government is choosing industrial protection over revenue even as its fiscal position deteriorates.