Lebanon: Government gives with one hand and takes with the other

As regional tensions rise, Beirut unveils costly salary bonuses while funding them through new taxes on the public.

Lebanon’s government has approved what it calls a major relief step: six additional monthly salaries for public sector employees and retirees. Officials estimate the move will cost roughly $800 million annually.

But the funding plan is already sparking backlash. To finance the bonuses, the government intends to raise VAT to 12%, impose a 300,000 Lebanese pound levy (about $3.30) on every 20-liter fuel tank, and increase container fees at ports.

Economic experts argue the numbers don’t add up. According to critics, the state plans to collect nearly $1 billion in new taxes—significantly more than the projected cost of the wage supplements. In their view, the salary boost is a political maneuver designed to soften public anger while using rising living costs to plug massive holes in Lebanon’s shattered budget.

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