The Ministry of Finance (MoF), has issued and published the here below the Decision No. 17/1 dated 13 January 2020 relating to the implementing provisions of Law No. 662 dated 04/02/2005 allowing the Minister of Finance to carry out the adjustment of penalties for tax infringements incurred prior to 31/07/2019 (inclusive).
This decision grants taxpayers that are subject to penalties of collection rebates covering all tax infringements related to income tax, VAT, built property tax, inheritance tax and indirect taxes and fees that occurred until 31/07/2019 (inclusive).
The said penalties are reduced from the date of publication of this decision till 29/02/2020 as follows:
- Variable penalties are reduced by 85%,
- Lump sum penalties are reduced by 60%.
It should be mentioned in this regard that the variable or the lump sum tax penalties of collection cannot be less than LBP 50,000 in any case after reduction.
The adjustment of any penalty with a value exceeding one billion Lebanese Pounds after reduction is subject to the prior approval of the Council of Ministers.
Besides, this decision also grants taxpayers that are subject to penalties for delay in payment rebates covering all tax infringements related to indirect taxes and fees, fiscal stamp duty and VAT, that are due or that shall be due within the implementation period of this decision, whether the delay in payment occurred before or after the entry into force of this decision or related to fiscal periods that the declaration deadline expired before 31/07/2019 (inclusive).
The delay in payment penalties are reduced for all tax infringements incurred until 29/02/2020 by 75%.
The recovery services in charge of rebates of penalties of recovery and collection rebates shall proceed with the reduction upon the payment of the due amounts by the taxpayers and thus, according to recovery programs; provided however that said services shall organize monthly declarations related to the reduced penalties and submit them before the regional financial service.
Thus, according to this decision, the tax penalties rebates are applicable to all tax adjustments settled before the 29th February 2020 (extended afterwards)