‘132,000 companies involved in tax evasion’

AMMAN — Around 132,000 registered and active companies practice a type of tax evasion, as the income tax these companies pay collectively for their activities each year does not exceed JD60 million, a study by the Income and Sales Tax Department (ISTD) has found.

The study — which sheds light on the risks of tax evasion in Jordan, its repercussions and the dire need to solve the problem — noted that the average income tax revenues from each of the 113,000 general partnership and 18,600 limited partnership companies does not exceed JD455 in average annually.

One-third of general partnership and limited partnership companies are inactive and currently being unlisted from the companies register at the Companies Control Department, the study indicated, commending the commitment of a large number of these companies to pay their taxes, the Jordan News Agency, Petra, reported. 

The findings of the study accord with those reached by a Jordan Strategy Forum’s (JSF) study, which showed that the country’s low tax revenues are attributed to low amounts paid by professionals and small- and medium-sized enterprises (SMEs), as well as tax evasion and weak mechanisms of collecting tax money.

The JSF study showed that the total tax revenues from 150,000 professional jobs and SMEs in 2016 reached some JD75 million, “a very small figure compared to the scope of their activities”.