Capital city: Beirut
Currency: Lebanese pound (LBP)
GDP: USD$88.8 billion
GDP per capita: USD$14,784
Lebanon, officially known as the Lebanese Republic, is a sovereign state bordered by Syria and Israel. Its location at the crossroads of the Mediterranean Basin and the Arabian hinterland facilitated its rich history and shaped a cultural identity of religious and ethnic diversity.
Lebanon's history since independence in 1945 has been marked by alternating periods of political stability and turmoil. Before the Lebanese Civil War (1975–1990), the country was renowned for its culture and prosperity, driven by tourism, agriculture, commerce, and banking. Lebanon was referred to as the 'Switzerland of the East' during the 1960s. Its capital, Beirut, attracted so many tourists that it was known as 'the Paris of the Middle East'.
The civil war resulted in a massive loss of human life and property while devastating the country's economy. One hundred fifty thousand people were killed, 200,000 wounded, and the war-displaced 1,000,000 civilians and left Lebanon in ruins. The damage to Lebanon's economic infrastructure was so significant that its national output (GDP) was cut in half.
Lebanon's tax system is structured so:
- Income tax is levied based on the territorial system—this means only Lebanon sourced income is taxable.
- Companies pay a flat 15% tax rate.
- Holding companies are exempt from tax on profits and only pay an annual fee of US$3,333 per year.
- Offshore companies are exempt from tax and only pay an annual fee of US$667 per year.
- No fringe benefits tax.
- Permanent tax exemptions apply to banks offering medium to long-term loans.
- There are no exchange controls.
- Personal tax rates start at 4% and have a maximum rate of 21%.