Khalil Denies Gasoline Price to be Hiked to Solve Housing Crisis

Caretaker Finance Minister Ali Hassan Khalil on Monday denied media reports alleging that gasoline prices will be hiked to resolve the housing loans crisis.

“There are no new taxes in the draft 2019 state budget and hiking gasoline prices is not proposed at all,” Khalil said.

Al-Akhbar newspaper reported Monday that Central Bank Governor Riad Salameh had rejected a lawmaker's proposal to tax banks to fund housing loans for citizens.

It said the issue was raised in a meeting last week between Salameh and MPs from the National Economy, Trade, Industry and Planning Parliamentary Committee.

“The crisis can only be solved through imposing an LBP 5,000 tax on gasoline and through hiking the VAT tax,” Salameh was quoted as saying according to al-Akhbar.

The Central Bank had recently issued a memo revising loan interests backed by it as the housing bank sharply toughened its lending terms.

According to reports, the housing bank raised the interest rate from 3% to 3.75% as it lowered the payment period from 30 to 20 years. The interest rate for Lebanese expats was meanwhile raised from 2% to 2.75% with an unchanged 30-year payment period.

Under the new reported terms, the bank would also withhold loans from anyone who inherits a house outside Beirut and anyone who benefited from a housing bank loan in the past.