Isis revenue drops nearly a third after loss of territory shrinks tax base

Jihadists including raising taxes and creating levies including fines for not being able to answer questions on the Koran, say US analysts

Iraqi soldiers hold an Isis flag after they gained control of the city of Heet in western Iraq after days of fierce clashes.
Iraqi soldiers hold an Isis flag after they gained control of the city of Heet in western Iraq after days of fierce clashes. Photograph: Nawras Aamer/EPA

Agence France-Presse
Sunday 17 April 2016 21.45 EDT

Islamic State’s revenues have dropped about 30% since mid-2015, forcing the group to introduce a range of new taxes, a research group has said.

“In mid-2015, the Islamic State’s overall monthly revenue was around $80m,” said Ludovico Carlino, senior analyst at IHS, which issues regular reports on Isis-controlled territory.
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“As of March 2016, the Islamic State’s monthly revenue dropped to $56m,” Carlino said.

An IHS report also said oil production in areas controlled by Isis jihadists was 21,000 barrels a day, down from 33,000 barrels a day.

This was due largely to airstrikes by the US-led coalition and Russia, although IHS warned the decline was only an “interruption of production” because jihadists were able to repair infrastructure quickly.

The report said about 50% of Isis revenues come from taxation and confiscation of businesses and property, with 43% coming from oil.

The remainder is made up of drug smuggling, the sale of electricity and donations, the report said.

“The Islamic State is still a force in the region but this drop in revenue is a significant figure and will increase the challenge for the group to run its territory in the long term,” Carlino said.

IHS said Isis had lost about 22% of its territory in the past 15 months and now ruled over six million people instead of nine million. This meant its tax base had become smaller.

“Our research has found that the Islamic State is increasing taxes on basic services and coming up with new ways to get money from the population.

“These taxes include tolls for truck drivers, fees for anyone installing new or repairing broken satellite dishes, and ‘exit fees’ for anyone trying to leave a city,” Carlino said.

Fines for not being able to answer questions correctly on the Koran have also been introduced and Isis is also taking cash as an alternative to corporal punishment penalties, IHS said.

Since the Syrian conflict erupted in 2011, half of the country’s population has been displaced – including five million who have fled to neighbouring states. More than 270,000 people have been killed.

A truce brokered by Russia and the US in February excludes the fight against the Isis or al-Qaida’s affiliate in Syria.

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