A 10 per cent duty and value-added-tax has been imposed on ‘personal parcels’ valued above BD100.
Globally, governments levy taxes and surcharges to meet obligations such as defence and public services.
It is also true that, despite prolonged international economic challenges, this welfare state has largely shielded the public through prudent policies.
However, the new duty on personal parcels is likely to affect ordinary households, whose purchasing power has already been under pressure for more than a decade.
Clarity is also needed on the definition of ‘personal parcels’.
If defined simply as shipments under an individual’s name, there is a risk that consignments may instead be routed through commercial registrations (CRs), potentially undermining the intent of the policy.
From personal experience, online purchases have become essential for many families due to significant price differences.
Items frequently cost far less when ordered from abroad, even after delivery charges. This highlights a persistent pricing gap between local and international markets.
Strengthening the national economy is essential, particularly in light of recent regional challenges.
However, policy responses must be carefully calibrated. Alongside revenue measures, there should be greater scrutiny of public expenditure – particularly on non-essential renovations and upgrades – with a stronger focus on improving service delivery.
The suggestion to establish a National Development Fund could be explored further.
Contributions could be drawn from sectors with proven resilience or high demand, while ensuring transparency and fairness in implementation.
At the same time, unnecessary administrative burdens – such as those arising from parcel duties – should be weighed against the actual revenue they generate.
Finally, it is worth reflecting on longer-term trends. Decades ago, Bahrain was a regional shopping destination, attracting visitors and encouraging outbound purchases.
Today, patterns appear to have shifted, with more spending taking place abroad or online.
A closer study of these changes, including the impact on local commerce, may provide valuable insights for policymaking.
A balanced approach that supports both revenue generation and consumer welfare will be essential in sustaining economic growth.
Muhammad
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