Low Earners May Go Tax-Free as Algeria Strives to Stem Dissent

(Bloomberg) -- Algeria will exempt low-earning workers from income taxes in a government plan that is new President Abdelmadjid Tebboune’s latest response to almost a year of mass protests in the North African OPEC nation.

The program, passed Thursday by parliament, also repeated long-promised initiatives, including the development of large-scale renewable power projects enabling Algeria to export more of its gas as well as allowing local financial firms to issue Islamic bonds.

In a plan that seeks to promote equality and spur foreign investment, key details on funding are lacking. One of the most explicit pledges is to exempt Algerians earning less than 30,000 dinars ($249) a month from income tax; another section promises to boost tourism by reworking the complicated visa system and encouraging charter flights. It didn’t say when the measures would take effect.

Tebboune, who was elected December in a sparsely attended vote, has vowed to turn around an economy that’s struggling with lower oil prices and a youthful population hungry for change. Protests that began in early 2019 and led to veteran leader Abdelaziz Bouteflika’s resignation in April have sporadically continued as demonstrators press for root-and-branch restructuring of the military-dominated country.

The so-called action plan gestures to some of these demands, vowing reforms to electoral laws to allow the emergence of a “new generation of elected representatives,” a “resolute fight against corruption” and to support independent media.

The initiative also targets the development of 4,000 megawatts of clean energy before Tebboune’s mandate ends in 2024, and another 11,000 megawatts before 2035. Algeria currently has capacity to produce 21,000 megawatts, and there were no details on how the expansion would be financed.

--With assistance from Souhail Karam.

To contact the reporter on this story: Salah Slimani in Algiers at sslimani2@bloomberg.net

To contact the editors responsible for this story: Nayla Razzouk at nrazzouk2@bloomberg.net, Michael Gunn, Sebastian Tong

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