Bahrain’s $238m annual interest ‘may rise’
Manama, March 11, 2012
Bahrain’s government pays BD90 million ($238.7 million) every year as interest on loans and the figure is set to increase in coming years, said the Finance Ministry.
A report from the Ministry added that the government deducts one per cent from employees' salaries against unemployment benefits to reduce the burden on the state budget.
The ministry issued the report following an attempt by MPs to draft a law making the 1 per cent cut optional, reports our sister paper Akhbar Al Khaleej.
The report observed that laws concerning insurance against unemployment are sophisticated and adopted in all advanced countries.
It added that several of GCC countries were working towards adopting such measures and such structural changes could not be brought about by simple legislations, but needed comprehensive changes in laws.
The report went on to say that imposing taxes in certain areas could be considered. Taxes can be imposed on companies operating in Bahrain, though it would be difficult to impose them on foreign companies that choose Bahrain as its headquarters, as they will head for other shores.
The report also touched on subsidies on essential items, saying that when it was introduced in Bahrain, foreigners were only 20 per cent of the population, but now it is about 65 per cent. This calls for new laws to direct government subsidies to deserving citizens, the report said. – TradeArabia News Service