Parliament rejects proposal to impose tax on expat remittance

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Parliament rejects proposal to impose tax on expat remittance

Parliament rejects proposal to impose tax on expat remittance

The parliamentary Legislative and Legal Affairs Committee on Monday unanimously rejected the proposal to impose tax on remittances of expatriates because it is unconstitutional.

Earlier, the proposal was submitted by a number of lawmakers, who had proposed to impose a five-percent tax on remittances made by expatriates to help boost non-oil revenues to finance the budget.

According to local media report, some MPs pointed out the proposal is illegal, as the tax amount is more than the Zakat (2.5 percent) which is collected once a year while the tax on remittances will be collected monthly. They warned that this proposal, once implemented, will prompt expatriates to go through illegal channels to send money back home.

The Kuwait Central Bank had also rejected the idea, saying it is not in line with Kuwaiti laws and warned of its negative impacts on the national economy. The 3.1 million expatriates living and working in Kuwait send around $18 billion to their families in their home countries every year.