Thursday, December 22, 2005

Cop out?

Yesterday I suggested that the house might modify the budget that was submitted by the government. The purpose would be to force the hand of the government and the senate on the regressive tax code which was passed unconstitutionally, rejected by the house, and still in force because the senate refuses to take action on it.

Today, Dr. Hashim Dabbas, the chief financial whiz in the house and member of the finance committee conceded that: 1- The government inflated the expenditures by inflating the projected cost of oil; 2- The income tax law hurts limited income people to the benefit of the rich and 3- passing the income tax law was an abuse of legal procedures.

However, he claimed that it was not in the power of the committee or the house to modify the budget, and their role is simply to "make recommendations", which the government routinely ignore.

Article 112 paragraph (iv) of the Jordanian constitution states the following:

The National Assembly, when debating the General Budget draft law or the provisional laws relating thereto, may reduce the expenditures under the various chapters in accordance with what it considers to be in the public interest, but it shall not increase such expenditures either by amendment or by the submission of a separate proposal. However, the Assembly may after the close of the debate propose laws for the creation of new expenditures.

So, it is clear that while the house has no right to change existing tax laws at this stage (they already rejected the income tax law), they can modify the expenditures to make them fit projected revenues based on the old tax code.

The purpose would be to allow for the possibility that the tax law be rejected. Clearly, if the budget is passed in the present form, then it would be impossible to do anything but let the new tax law pass. It would affirm that what was done was correct retroactively. To pretend that the house can't change anything is a cop out.


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