Kuwait: Tax on Expats Remittance Revives Discussion
Tax on Expats remittances returned to the limelight again as Kuwaiti ministers called the parliamentary committee to include this in the agenda.
Migrant workers transfer about 4.2 billion dinars annually from Kuwait, he added, citing figures from Kuwait’s Central Bank. Imposing tax on this transfers will have a role in improving state revenues and diversifying sources of income, he said.
“This system is in effect in most countries of the world and in more than one Gulf country. Expats there have not objected to it. Allowing this money to exit the country is very dangerous and has a direct effect on economy,” MP Al Saleh said.
He added, “We do not target the expatriate brothers, because imposing symbolic fees on financial transfers will not have an impact on their money, and in return it has a positive return on the state’s economy”.
Kuwaitis currently make up less than 30 percent of the 4.7 million population – they number 1.4 million against 3.3 million expatriates.
In June, MP Hashem, who has been extremely vocal about reducing Kuwait’s expat population, urged to expel close to two million expatriates from the country over the next five years to rectify its ‘demographic imbalance’.
Expats draw about 70 percent of the entire population of Kuwait as of the close of June 2018, i.e. a population of 4.7 million people.
“We are not against any honest expat whose skills are needed by the country, but we are against crowding, unproductive expatriates who have not left any breathing space for Kuwaitis,” said the lawmaker.
Meanwhile, The Kuwait government has decided to intense the process of ‘Kuwaitisation’ of its employment sector. The step was taken by Walid Al Jasim, the minister for Municipal Affairs in Kuwait, His proposal has got widespread recognition.
The sources said new laws, to be introduced soon, will put an end to the excessive increase in a number of communities, and that the quota system will be implemented, so that the largest community will not exceed 20 per cent of the number of expatriates, and members of one community will not dominate any proportion.