Hundreds of Jordanians protest against IMF-backed tax bill

Hundreds of Jordanians have protested in central Amman in the first demonstration against a new, International Monetary Fund-backed tax bill that parliament passed in November.

Around 300 people chanting anti-government slogans gathered near a parking lot on Friday where police had imposed a cordon to prevent them from marching to the office of Prime Minister Omar Razzaz.

Scores chanted "Go away Razzaz!", "Government of robbers!" and accused the government of failing to tackle high-level corruption and to end the squandering of public funds.

Jordan's mainly pro-government parliament approved a new IMF-backed tax law nearly two weeks ago that imposes steep tax increases to narrow the record public debt and help get the economy, hit by conflict in the region, back on track.

King Abdullah replaced the government in June after its push to impose an earlier tax bill led to a rare wave of protests, only a few months after hefty tax increases were imposed on basic commodities.

That tax bill was reworked into the new bill that parliament has now approved.

Popular discontent has in recent weeks grown with the Razzaz government, the Reuters news agency reported.

Many say that it has introduced only cosmetic changes to the earlier tax law and has failed to deliver on pledges of cutting waste and curbing corruption.

Bread subsidy scrapped

Earlier this year, Jordan increased a sales tax and scrapped a subsidy on bread as part of a three-year fiscal plan agreed with the IMF, which aims to cut public debt of $37bn, equivalent to 95 percent of the gross domestic product.

Many politicians and economists blame the IMF-inspired austerity plan for worsening the plight of poorer people and squeezing the middle class while widening disparities between the rich and poor. 

Economists told Reuters that Jordan's ability to maintain a costly subsidy system and a big bureaucracy was increasingly untenable in the absence of foreign capital inflows or injections of foreign aid, which have dwindled as the Syrian crisis has gone on.

With a lack of natural resources to boost state coffers, Jordan relies heavily on foreign aid and faces an unemployment rate of 18.5 percent.

Stability in Jordan is seen as fundamental to the region, and in the wake of protests Amman was offered a $2.5bn aid package from three Gulf backers.

More than $1bn has already been deposited in the central bank by Kuwait, the United Arab Emirates and Saudi Arabia, a Jordanian government source said in October.