The Lebanese Cabinet, during its session on Monday, February 16, 2026, approved a salary increase for public sector employees across all levels, including contractors and retirees. This increase amounts to six additional salaries, along with full benefits for military personnel. This decision sparked widespread objections from a broad spectrum of politicians, public figures, and citizens. It also faced disapproval from both active and retired public sector employees, both military and civilian.
This was not the first instance of the current government imposing fees on gasoline. A similar measure was approved in a session on May 19, 2025, but was halted by a ruling from the State Council on July 16, 2025, due to appeals made against it. This ruling was seen as a significant legal development aimed at relieving what was perceived as an additional burden on citizens during challenging times, and it was met with considerable approval.
The Ministry of Finance, along with the Lebanese government, should refrain from making arbitrary salary and wage increases. Additionally, it should avoid relying on the easiest sources of funding for these increases, specifically the imposition of a fee on gasoline, which was set at 300,000 Lira, along with a 1% increase in the value-added tax, raising it from 11% to 12%. This is particularly pertinent given that only a few months have passed since the ruling on the previous decision.
It is important to highlight the anticipated inflationary impact of these measures. The rise in fuel costs directly affects transportation prices and the costs of goods and services, leading to the erosion of part of the granted increase. This creates a vicious cycle of salary increases and rising prices, without addressing the fundamental market imbalances.
In light of the current government’s chaotic approach to resolving the salary correction crisis, several questions arise regarding its inaction since its formation in initiating a fair and just plan for correcting public sector salaries and wages, while also considering the state of public finances:
First, the issue of correcting the salaries and wages of public sector employees and retirees is not new; it has been present since the onset of the crisis and represents both a direct outcome of it and a clear indicator of its continuation and complexity. Any delay in addressing this issue within a comprehensive reform framework will likely prolong the crisis and exacerbate its economic and social consequences.
Second, the government’s lack of a comprehensive economic vision, based on clear and measurable goals distributed within a phased timeline for implementation, constitutes a structural flaw that hinders achieving desired outcomes and weakens the effectiveness of public policies aimed at achieving the desired economic revival.
Third, any serious attempt to address salary issues must be linked to administrative reforms that enhance public sector productivity and restructure institutions suffering from bloated staff or overlapping responsibilities. This way, correcting wages can shift from a financial burden to an investment in administrative efficiency and the quality of public services.
Fourth, negotiating with the International Monetary Fund as a means to restore international confidence in the Lebanese economy and its institutions does not justify the automatic adoption of its recommendations or conditions. Experiences show that some of the programs implemented in various countries have deepened economic and social imbalances, necessitating a conscious negotiation approach that considers national specifics and balances the need for reform with the protection of social stability.
Fifth, economic growth remains elusive as long as the incomes of a significant segment of society do not cover even the minimum of their living expenses. The imbalance between income and living costs affects not only individuals but also negatively impacts macroeconomic dynamics, undermining the effectiveness of developmental policies and weakening the potential for implementing growth plans and achieving their objectives.
Sixth, the high salaries approved by the government for regulatory bodies indicate a clear disparity in fairness among different job categories within the public sector, raising legitimate questions about the basis for these increases. Justifying them as a means to attract talent is insufficient or convincing, particularly given the advisory and non-binding nature of these bodies’ decisions toward the governing authority. This necessitates a reevaluation of salary and compensation philosophies, considering the principles of fairness and institutional balance.
Seventh, the current government shows a notable leniency in collecting fees owed on maritime properties, depriving the treasury of annual resources estimated between $250 million and $500 million. This represents a financial waste that directly impacts public financial balances and sustainable funding capabilities.
Eighth, addressing maritime property issues should not be limited to collecting overdue fees. It should be part of an integrated policy for managing public properties, ensuring the resolution of illegal occupancy issues, reassessing rental fees to align with market value, and converting these revenues into a sustainable resource for the treasury.
Ninth, the government has fallen short in launching a comprehensive reform of the tax system and updating it to effectively uphold the principle of progressive taxation, directing tax burdens toward wealthy individuals and those with high incomes, instead of imposing them on low-income groups and those most vulnerable socially.
Tenth, the government lacks a clear and comprehensive plan to combat tax evasion and to develop mechanisms for collecting fees and taxes that enhance transparency and efficiency. This requires simplifying and facilitating payment methods, updating collection systems, alongside tightening controls and activating accountability measures against those who default on payment, thus solidifying tax compliance and promoting fairness in the financial system.
Lastly, the current government’s approach does not differ from its predecessors regarding reliance on indirect tax increases and fees affecting various social strata without a meaningful distinction between income levels as a primary source for funding the proposed increases, without effecting a fundamental shift in the philosophy or methods of treatment. This raises issues related to tax justice and the negative social impact of these measures.
Discussions in the Cabinet revealed that the Ministry of Finance did not comply with the requirement to provide ministers with the study regarding the cost of the proposed increase and its distribution mechanisms, as this information was not disseminated 48 hours before the session, preventing ministers from reviewing and discussing it appropriately.
Correcting salaries and wages is a legitimate right for public sector employees and retirees, but ensuring it is fair and sustainable requires moving away from short-term fixes and embracing a structural reform mindset. This issue is not merely about increasing figures on salary tables; it is about rebuilding trust between the state and its citizens through a fair financial policy, sound resource management, and a clear economic vision. Without this, financial decisions will continue to cycle in a loop, caught between public pressure, budget constraints, and diminishing purchasing power, while economic revival remains postponed.
