DINAR REVALUATION REPORT: Iraq's Tax System Development for Investors in 2024, 9 SEPT

Iraq's Tax System Development for Investors in 2024

In 2024, Iraq is in the process of developing a tax system that is attractive to investors. 1 The government is keen on enhancing fiscal space and opportunities for countercyclical policy, especially in the wake of the macroeconomic volatility caused by overdependence on oil revenues. 1 This move is part of a broader effort to diversify the economy and reduce the impact of oil price fluctuations on the country's budget and overall economic health.

Current Economic Situation and Challenges

Iraq's economy, heavily reliant on oil, has faced significant challenges in recent years. The unemployment rate, particularly among the displaced, returnees, women jobseekers, and those in the informal sector, has remained high. 1 The COVID-19 pandemic exacerbated existing economic issues, leading to a sharp contraction of 11.3% in real GDP in 2020. 1 However, there are signs of recovery as oil production increases and COVID-19 restrictions ease, allowing for a gradual restoration of domestic economic activity.  1

Tax System Reforms for Investors

Iraq's tax reforms aim to create a more stable and predictable investment climate. The government is working on improving oil receipts, which turned the overall fiscal balance to a surplus in 2021. 1 This surplus was partly due to budgetary gains from higher oil prices and measures to mobilize non-oil domestic revenues, primarily from customs. 1 These efforts are crucial for attracting foreign direct investment (FDI) and stimulating the private sector, both of which have remained weak. 5

Investment Law and Policies

Iraq has put in place an investment law (Investment Law No. 13 of 2006) that offers various incentives and protections for investors. 4 This law defines the roles and responsibilities of the National Commission for Investment and other regional and governorate commissions in granting investment licenses and overseeing investment projects. 4 The law also outlines the rights and obligations of foreign investors, aiming to provide them with a clear legal framework. 4

Doing Business in Iraq

The World Bank's Doing Business report highlights the procedures involved in starting and operating a business in Iraq. 2 While there are challenges, such as the time taken to complete certain procedures, the report provides insights into the business environment and the steps the government is taking to improve it. 2

Conclusion

Iraq's efforts to develop a tax system that is more welcoming to investors are part of a comprehensive strategy to diversify the economy and reduce dependence on oil revenues. By improving fiscal space, enhancing domestic revenues, and creating a more stable investment climate, Iraq aims to attract more foreign investment and stimulate growth in the non-oil sectors. The government's focus on legal frameworks and investment laws, along with improvements in the ease of doing business, are key steps in this direction.

 

Government Advisor: We are working on developing a tax system that is attractive to investors, 9 SEPT

  Government Advisor: We are working on developing a tax system that is attractive to investors

The head of the Supreme Committee for Tax Reform, the Prime Minister’s Advisor for Economic Affairs, Abdul Hussein Al-Anbaki, announced today, Sunday, a three-pronged plan for tax reform. While he indicated that facilitating measures would be taken regarding the tax administration, he confirmed that previous fines would be exempted for many groups to restore the confidence of taxpayers in paying taxes.

Al-Anbaky said in an interview with the Iraqi News Agency, which was followed by "Al-Eqtisad News", that "some media outlets interpreted the tax reform as aiming to increase non-oil revenues, and this interpretation is not scientifically sound," indicating that "the main goal of the tax reform is to create an easy and transparent tax system that is friendly to the business environment and attractive to investors, because the tax rate is not the basis, but rather the tax rate when multiplied by the tax base is the result of the tax revenue."

He continued: "We seek in tax reform to have a large tax base," explaining that "when the tax base is large, tax revenue will inevitably increase, even if tax rates are the same and at lower rates."

He added that "tax revenue is a by-product of the tax reform situation and not the basis for which the tax reform is launched," noting that "the Supreme Committee for Tax Reform wants to achieve tax justice and make tax accounting easy and transparent and does not want there to be cases of extortion, obstruction and delay of tax procedures."

He pointed out that "many facilities have been made, which ultimately lead to restoring the confidence of taxpayers in paying taxes in the tax administration," indicating that "many categories have been exempted, the cases of allowances have been expanded, and they have been exempted from previous fines and accumulated interest in order to restore the confidence of taxpayers in the tax administration."

He said, "When taxpayers come to account, this will lead to an increase in tax revenues," stressing that "the aim of these measures is to create a tax system that is attractive to investors and not just to seek to increase tax revenues because increasing tax revenues is a foregone conclusion."  link

Q & A WITH MARKZ, 9 SEPT

 MarkZ   

[via PDK]  Question:  What is your gut feeling for RV Mark? 

 MarkZ:   …nobody knows the timing…but my gut feeling is between the 11th and 15th…just a guess…

 Question:  Are we going to banks or redemption centers?

  MarkZ:  They are the same things…The redeeming banks/redemption centers…are bank locations with trained staff and equipment to handle our exchanges...I was told 90% of Americans will have an exchange location within 50 miles of their house….  If you are in remote rural areas …you may have further to go…not sure about other countries.

Question:  Will they release the RV on weekends or week days? 

 MarkZ:  I am told its easier to release it on a weekend- Saturday night to Sunday morning …but anytime is fair game.

Iraq's Path to Recovery: Opportunities and Challenges

DINAR REVALUATION REPORT: Opportunities in Iraq: Overcoming Turmoil and Embracing Recovery, 9 SEPT

 Opportunities in Iraq: Overcoming Turmoil and Embracing Recovery

The American Atlantic Council Institute has announced an upcoming conference on Iraq, scheduled for October 15, 2024, in Washington. 1 This gathering aims to explore the opportunities and challenges in the evolving relationship between the United States and Iraq, as the latter continues to emerge from years of political and social turmoil. 1 The conference, titled "The Path to Recovery, Development, and Global Partnerships in Iraq," will be the third of its kind under the "Iraq Initiative". 1

Addressing Challenges and Embracing Opportunities

At the conference, a diverse group of senior experts, researchers, and policymakers from both the United States and Iraq will convene. 1 Among the attendees are current and former senior officials who will contribute to discussions on major challenges and opportunities facing Iraq as it transitions from instability. 1 This year, the focus will be on the advancement of the energy sector, efforts toward sustainable economic diversification by the Iraqi government, and the evolving course of US-Iraqi relations.  1

Interactive Panels and Engagement

The conference will feature dynamic discussion panels that will delve into how Iraq, the United States, and the international community can positively engage with Iraq as it navigates its unique social, political, economic, and security transformations. 1 Direct personal participation and engagement via video are expected, with translation into Kurdish and Arabic provided to ensure inclusivity. 1

The Iraqi Initiative: A Framework for Change

The "Iraq Initiative" program, under which the conference is being held, is designed to provide transatlantic and regional policymakers with unique insights and strategies for supporting Iraq's recovery and development. 4 The initiative recognizes the critical role of the Iraqi Police Agency in the country's transition from conflict to peace and stability. 3 It emphasizes the importance of transforming the police force into a trusted and effective service that upholds the rule of law and protects human rights.  3

Economic Recovery and Diversification

As Iraq moves toward recovery and development, the country's economic transformation is a focal point. 1 The Iraqi government's efforts toward sustainable economic diversification are crucial for the nation's long-term stability and prosperity. 1 The conference will discuss the progress made and the path forward in this critical area. 1

Transatlantic and Regional Policy Engagement

The "Iraq Initiative" aims to facilitate engagement between transatlantic and regional policymakers, offering a platform for the exchange of ideas and strategies to support Iraq's path to recovery and development. 4 By fostering dialogue and collaboration, the initiative seeks to contribute to a more peaceful and prosperous future for Iraq and the region. 4

Conclusion

The upcoming conference in Washington signifies a significant step in recognizing and addressing the opportunities and challenges facing Iraq. 1 As the country moves past years of turmoil, the gathering of experts and policymakers promises to be a pivotal moment in charting a path toward recovery, development, and enhanced global partnerships. 1

Opportunities in Iraq” after overcoming “years of turmoil” at an international conference in Washington, 9 SEPT

 Opportunities in Iraq” after overcoming “years of turmoil” at an international conference in Washington

The American Atlantic Council Institute announced that it will organize a conference on Iraq in Washington on October 15, with the participation of current and former politicians and experts from the United States and Iraq, where it will address opportunities and challenges in relations, overcoming years of turmoil, with a focus on the energy sector, and diversifying the Iraqi economy. 

According to the American Institute, the conference, which is being held within the framework of the "Iraq Initiative", under the title "The Path to Recovery, Development and Global Partnerships in Iraq", will bring together a diverse group of senior experts, researchers and policy makers from both the United States and Iraq, including current and former senior officials. 

The report, translated by Shafaq News Agency, explained that the conference, the third of its kind for the "Iraq Initiative", will address the major challenges and opportunities facing Iraq as it begins to overcome years of volatility, with early signs of recovery and development. 

The report added that the conference will focus this year on the advancement of the energy sector, the efforts of the Iraqi government towards sustainable economic diversification, and the evolving path of the US-Iraqi relationship. 

The report added that the conference will witness dynamic discussion panels that explore how Iraq, the United States and the international community can interact positively with Iraq as it moves through its unique social, political, economic and security changes.

The report added that the conference will witness direct personal participation and via video, and will include translation into Kurdish and Arabic. 

The report concluded by saying that the "Iraq Initiative" program provides transatlantic and regional policymakers with unique insights and analyses on the ongoing challenges and opportunities facing Iraq as the country attempts to establish an inclusive political system, attract economic investment, and stimulate a vibrant civil society.  link

LATEST FROM WALKINGSTICK, 9 SEPT

  Walkingstick 

  I strongly believe we need Alaq to finish what he's doing [In New York and Washington], come back...to Baghdad and bring the REER - Real Effective Exchange Rate to Iraq. 

 We believe this is the next step because of what Sudani told the Iraqi citizens. 

 IMO the commercials are the next thing that they're going to show them.  IMO the commercials are already produced...They will be released to the public. When Sudani said the monetary reform is coming to an end...that's a big hint...That's what we in intel call a big clue. 

Walkingstick 

 All the executive levels of the banks in Iraq are going to sit down with the governor of the CBI Alaq and receive instructions on the new currency next week.  

Walkingstick 

  They got stability and security. Sudani has been bragging about it...Lift the three zeros has to do with the value, then not with the value, back and forth, back and forth, it has to do with the value and then, no it doesn't have to do with the value.  The articles are contradicting. 

 They are lies.  They are misleading with a purpose.  

 Walkingstick  

Article: "Two conditions to achieve it .. Al-Sudani's advisor rules out removing 3 zeros from the currency"

  These articles, this misleading, is intentional right now...Contradicting statements are found throughout all of these statements, all of these articles...The 25 note has to become a 25k note? 

 There isn't even a 25 note...When did Iraq last have a 25 note?  Never.

--

 Walkingstick  

[Iraqi bank friend Aki update] 

Question:  You're asking us why we are not talking to you about these [lower note] commercials.  Can you tell us more about them? 

 AKI:  Yes, they are coming out.  This is the media campaign we told you about.  It's getting faster and faster and louder and louder.  

The purpose is to show the citizens the new lower notes and more information. 

 These commercials are coming out at any time now...Nothing is in the way to block this next step.  It is a massive media campaign.   

[[Iraqi bank friend Aki update]

New York is to remove the red tape that the United Nations is still holding on the banks of Iraq that are not participating in the monetary reform.  

These sanctioned banks may stay sanctioned or be shut down completely. 

 It really doesn't matter to the monetary reform process but this is something that is needed to be done.

https://dinarevaluation.blogspot.com/2024/08/lower-notes-yes-they-are-coming-out-by.html