Bahrainis who tear down their private residences to rebuild could be exempt from paying infrastructure tax.
Under the 2015 Infrastructure Cost and Development Law, a levy of BD12 per square metre is issued on all developments in a bid to fund infrastructure projects such as roads network, sewerage systems, electricity and water schemes.
The tax aims to support the state budget by collecting money from property developers to fund infrastructure for their projects.
The levy is also applied on Bahraini nationals and expatriates who tear down their rundown homes and rebuild new residential properties.
However, a proposed amendment to the law was submitted to parliament yesterday by chairwoman Fouzia Zainal and three other MPs.
The proposal aims to exempt Bahraini nationals from the tax if they are rebuilding a private residential property.
“The law doesn’t have the necessary exemptions that take into account social aspects and people’s living conditions,” said Ms Zainal in her written explanation.
“Collecting large sums from the public, especially those living in old homes who plan to tear down and rebuild, is a huge burden they can’t afford, especially at a time when living costs are very high.
“The implementation of the law on poor residents has not achieved purpose and many have complained to parliament and shown disapproval that their standards of living are being ignored and not taken into consideration.
“The law is directed at construction projects involving investments, businesses and those with commercial and financial rewards.
“In this case the private homes of Bahrainis don’t fall within the principle of the law and it should clearly exempt them from it.”
The proposal will be reviewed by parliament’s public utilities and environment affairs committee, which is set to summon officials from the Works, Municipalities Affairs and Urban Planning Ministry for feedback.
The law was passed by parliament in 2016 on a technicality when during the final round of voting MPs claimed that 21 members voted against it, rendering it void and suspended.
However, after listening to recordings of the voting process it turned out that only 20 voted against, which meant the law was referred to the Shura Council which later approved it.
MPs had no authority at the time to amend the law, which was presented as a Royal decree, with them only approving or rejecting its implementation.
Works, Municipalities Affairs and Urban Planning Minister Essam Khalaf told MPs in 2016 that the government was taking a fraction of the infrastructure development and maintenance cost, unlike in other GCC countries.
He also pointed out at the time that the decree tackled three aspects: Areas with no infrastructure, areas with infrastructure but requiring services, and areas with infrastructure but needing maintenance and renewal.
mohammed@gdn.com.bh
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