Libya amends income tax, keeps “jihad tax”July 25, 2010
Libya, which operates a nasty little Islamist zakat system alongside its income tax laws, features in PwC’s report for several changes related to flattening Libyan income tax rates and allowances.
One thing that has not changed, however, is Libya’s jihad tax (which PwC calls a “jehad tax” to misdirect you). What? A jihad tax? (Not to be confused with zakat or jizya taxes.) That’s right! Daffy Qaddafi has imposed a jihad tax since the 1970s for the purposes of “national defense.” Individuals pay a 3 percent jihad tax; corporations, 4 percent (see also here and here).
Like much of the money in the Islamic world, it’s not clear where these revenues wind up. The funds are thought to support attacks by Palestinian terror groups against Israel.
PwC’s report is supposed to help clarify tax rules for corporations doing business in the Middle East. But would you really enjoy conducting business in a country where, on top of every other silly banana republic tax you get smacked with, you have to pay an additional 4 percent to pay for Qaddafi’s jihad?