Poor public spending is a worse crime than direct taxation

Drip by drip the subject of direct taxation on income is being raised by Gulf states. Kuwait is the latest to crack. Its ruler used a local Arabic newspaper last week to point out the high cost of public services will eventually be met by a tax on personal income. Bahrain started a 1 per cent levy in June, the funds going directly to tackle unemployment.

Income tax, said Emir Sheikh Sabah Al-Ahmad Al-Jaber Al Sabah, was not a new concept concept and that it was the state’s right in return for services “but is also a contribution from the citizen to state development”. Oil is running out, the welfare burden is too great and diversifying the economy costs money. Direct taxation is a must, say economists.

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