Jordan to increase fuel, bread prices: reports

Jordan is to increase the price of fuel and bread as it seeks tax revenues to redress a debt-riddled economy rattled by the war in neighbouring Syria, press reports said on Tuesday.

The latest tax hikes come as resource-poor Jordan faces a public debt of some $35 billion, equivalent to 90 percent of its gross domestic product.

Tax on fuel is to increase from 24 to 30 percent, Jordanian newspapers reported the government as deciding on Monday.

And the price of bread is to double from next month, they also reported.

The tax on fizzy drinks is to jump from 10 to 20 percent and cigarettes are to cost 0.20 Jordanian dinar ($0.28) more per pack than previously.

A value-added tax of five percent will also be imposed on jewellery.

The government, which hopes to increase tax revenues by $761 million, also pledged "financial aid" to struggling families affected by the price hikes.

Last year, price hikes on am array of goods and services sparked protests in which demonstrators called for the cabinet to resign.

They came after new sales taxes on internet and mobile use, bread, domestic fuel and petrol, cigarettes and fizzy drinks.

In 2016, Jordan secured a $723 million three-year credit line from the International Monetary Fund to support economic and financial reforms.

Jordan's economy has been rattled by the conflicts in Syria and Iraq, and the country has taken in hundreds of thousands of refugees from its neighbours, stretching its meagre resources.

Some 680,000 Syrians have fled to Jordan since the start of the conflict in their home country in 2011, the UN refugee agency says. Jordan says it hosts 1.3 million Syrians.

Jordan says the Syrian crisis has cost it more than $10 billion over the past five years.

Source: AFP