23/07/2023

A report by the International Monetary Fund confirmed that the Jordanian government “made more progress” in the policy of expanding the tax base and improving tax compliance to combat tax evasion.

According to the sixth performance review report from the Jordan Program under the “Extended Fund Facility” issued by the Fund, the government “introduced an electronic invoicing system to enhance monitoring of economic activities,” indicating that it covered nearly 60 percent of all transactions subject to sales tax on goods and services until the end of last April.

The report indicated that the government seeks to expand coverage to 90% of all transactions subject to sales tax by the end of 2023.

And explained that the government has also completed electronic audit systems based on artificial intelligence for tax returns and has made “significant progress” in implementing measures to combat smuggling of tobacco products and alcoholic beverages and strengthening their tax administration through digital tracking procedures for spirits subject to customs duties and taxes due by the end of this year after its success in Tracking tobacco products and combating their smuggling.

On December 6, 2022, ISTD launched the e - invoicing system to serve taxpayers, the state treasury, companies and establishments, and taxpayers can obtain all tax services.

According to the report, the government pledged, through a letter of intent to the fund, to work to improve the collection of tax revenues to achieve 1.5% of GDP during the period 2024-2028.

The letter indicated that it had “made great progress” in advancing the implementation of this plan by closing tax loopholes, and the ISTD achieving great achievements in improving tax compliance and combating tax evasion.

The letter indicated that the implementation of new legislative and administrative reforms is expected to generate an additional 0.4% of GDP from revenues in 2024, and an additional 1.1% of GDP during the period 2025-2028.

The letter of intent expected that this would be achieved through measures to broaden the income tax base through further rationalization of tax exemptions (including through the new investment law) closing major tax loopholes as a result of the introduction of the Aqaba Special Economic Zone within the national tax and customs systems, in addition to the full implementation of For a tracking and tracing system for alcoholic beverages while preventing smuggling of cigarettes through border posts.

According to the ISTD, the electronic invoice is issued and preserved in an organized electronic format through a secure and protected electronic system. It contains the conditions of the tax invoice and is issued by a system that fulfills all the legal conditions and pillars of the invoice for taxpayers who are obligated to organize and issue invoices according to the provisions of the Organizing and Controlling Invoicing Affairs Regulation.

And according to the provisions of the Organizing and Controlling Invoicing Affairs Regulation and the instructions issued, establishments and licensed businesses whose annual sales are less than 75 thousand dinars are excluded from organizing and issuing the invoice. These include groceries (mini-market, supermarket, or shop), bookstores and stationery stores, vegetable and fruit stores, Shops selling household items, bakeries, popular restaurants, home businesses, dairy shops, shops selling sewing tools, in addition to crafts licensed in any of the Kingdom’s governorates according to the applicable legislation, whose annual revenues are less than 30 thousand dinars, and bakeries that sell bread only and whose sales are less Annual for 150 thousand dinars.

In a statement issued on Monday, the Director General of the ISTD, Husam Abu Ali, called on taxpayers who are obligated by the national e -invoicing system to adhere to issuing the invoice electronically through the national e –invoicing system.

Abu Ali said that companies, establishments, professionals, service providers, and craftsmen who are required to join the national e –invoicing system, who own computerized systems, are required to connect to the system and issue invoices electronically. As for companies, establishments, professionals, service providers and craftsmen who do not have computerized systems, they should take the initiative to use the national e –invoicing system to issue invoices electronically through the e –invoicing platform that was provided on the department’s website, which allows taxpayers to issue invoices through it if they do not have a computerized invoicing system.

He said that after the construction of the national e – invoicing  program was completed, which enables all taxpayers who are obligated to issue invoices to join the national e – invoicing  system or link with the national e – invoicing  system in a manner that unifies the foundations and requirements of the tax invoice, whether it is for selling a good or providing a service in return for consideration, it was completed. Approving the electronic invoice issued by the national e – invoicing  program or issued by a program that has been linked to national e – invoicing  program, according to what was stated in the amended system for the Organizing and Controlling Invoicing Affairs Regulation, No. (13) for the year 2023.