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Roundup: Gaza merchants decry fresh car import tax imposed by Hamas

Xinhua, June 11, 2015 Adjust font size:

Auto dealers in Gaza Strip have urged cancellation of a new 25 percent import tax imposed by Hamas, on top of a 50 percent tax already in place.

Dealers in Gaza, already subject to an import tax of 50 percent for cars delivered through Kerem Shalom commercial crossing with Israel, were surprised last week when told by Hamas custom officials that they have to pay an additional 25 percent tax imported into the blockaded territory.

Hamas has been ruling Gaza since it seized the territory by force in 2007.

Israel collects the 50 percent tax and then transfer to the Palestinian National Authority, currently in Ramallah.

Gaza importers have threatened to stop receiving cars through the Kerem Shalom crossing until Hamas agrees to cancel the additional 25 percent tax.

Some importers, however, are worried that the Hamas-run ministry of finance may stick to the new tax and close down any business that refuse to pay the tax, and revoke its license.

Kamal Tuman, an official at Car Importers' Society, said that they would take legal measures to defy the new tax.

"Our first step was our decision not to receive our cars at the Israeli Kerem Shalom crossing," he said. "We are going to take more steps until this tax is canceled. We may stop importing cars in protest to the new tax."

The new import tax, if enforced, will lead to significantly higher prices for cars sold inside the Gaza Strip, dealers say.

"The new tax will worsen the already suffering market," said Alaa Badwan, a car importer. "The car selling business is ailing and we barely make profits."

"Car prices are very high because of taxes," said Yossif Ahmed, a Gaza resident."The economic situation in Gaza is worsening and it is really difficult to buy such expensive cars."

The economy in Gaza Strip has significantly deteriorated due to an ongoing blockade and frequent military confrontations between Palestinian militants and Israel.

Official records show that youth unemployment in Gaza exceeded 60 percent at the end of 2014.

The Hamas government collects taxes on Gaza residents, including sales and income taxes as well as taxes on property and small businesses, to pay the 43,000 workers it employs. Enditem