Lebanese nightlife under tax scrutiny

Lebanon’s entertainment sector is heading into what is expected to be one of its busiest seasons in years, but this time under a dramatically different fiscal environment. The Ministry of Finance, acting on a directive issued by finance minister Yassine Jaber, has launched a strict tax-enforcement campaign targeting concerts, festivals, nightlife events, and any artistic activity involving foreign performers.

The directive instructs the Directorate of Revenues, the VAT Directorate, and all regional finance units to intensify their monitoring of events that generate taxable revenue. The message is clear: Lebanon intends to close long-standing gaps in reporting, especially as the entertainment sector rebounds after years of economic stagnation.

How the new tax regime works

Cross-verification and compliance

One of the central changes concerns how the state verifies income. The Ministry has ordered its departments to stop relying exclusively on documents provided by event organizers, such as tax-clearance certificates required for performance permits. Instead, authorities must now cross-check declarations with information from production companies, marketing and media agencies, and ticketing platforms to ensure accurate reporting. By expanding verification beyond organizer-provided paperwork, the Ministry aims to curb the underreporting that has long characterized the sector.

Taxation of foreign performers

A major component of the new measures addresses the fees paid to foreign performers. Contracts with non-resident artists are now explicitly subject to a 17 percent tax applied to 50 percent of the artist’s contractual fee, and the tax must be paid in the same currency used in the contract.

Although this withholding mechanism has existed for years, it has often been inconsistently applied. The Ministry is now insisting on full enforcement, raising the financial stakes for promoters who depend heavily on regional and international acts.

Entertainment tax and VAT distinction

Beyond raising VAT from 11 to 12 percent, a change that significantly increases costs for any organizer required to charge it, the Ministry also clarified when the 5 percent entertainment tax established under Legislative Decree No. 66/1967 applies. Because many cultural institutions and promoters are not VAT-registered, meaning they do not meet the turnover threshold that obligates them to collect VAT, the entertainment tax is applied directly to ticket sales for concerts and artistic events. The clarification is meant to resolve long-standing confusion over which levy applies in each case and to ensure that events are taxed consistently rather than slipping through administrative gaps.

Additional levies under law No. 56/2008

The Ministry also reiterated obligations under Article 16 of Law No. 56/2008, which requires contributions to the Lebanese Artists’ Mutual Fund. Under this law, a 10 percent fee is levied on contracts signed with foreign artists, and a separate 2 percent fee is applied to the value of concert and event tickets sold. These amounts are collected independently of both VAT and the entertainment tax, reinforcing existing social protections for Lebanese performers, protections that have frequently gone underfunded due to inconsistent enforcement.

Concerns from the industry

For the Ministry of Finance, the entertainment industry represents a fast-growing economic space whose tax contributions have not kept pace with its expansion. But while the state frames the new campaign as overdue fiscal discipline, industry stakeholders warn that the timing and cumulative financial weight of the measures may have far-reaching consequences.

Speaking with The Beiruter, Maya Noun, a board member of the Syndicate of Owners of Restaurants, Cafés, Nightclubs, and Pastries in Lebanon, said that the measures will almost certainly raise prices for audiences who are already financially-stretched and place additional strain on an industry already operating under severe pressure.

The cumulative effect of the renewed taxes, fees, and verification requirements may push organizers and booking agencies to seek alternative arrangements or avoid Lebanon altogether.

“International acts may think twice before choosing Beirut if costs rise unpredictably, especially during the off-season, when expat demand is low,” Noun said.

“This is not the right time,” she added, “The venues and promoters are still recovering from years of economic crisis, inflation, and soaring operating costs, and now we get inflicted with such taxations this really hurts us a lot.”

A sector under increased scrutiny

As concerts, festivals, and large-scale productions increase, the state appears determined to standardize enforcement and introduce greater financial transparency. While Lebanon’s entertainment season is poised to be vibrant, it will unfold under sharper scrutiny than ever before. The Ministry’s message is unmistakable: artistic freedom may define the stage, but fiscal discipline will define the industry behind it.