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Saudi Arabian officials deny expat fee rumours
| Published: | 14 Aug at 6 PM |
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Social media rumours that expat fees paid by companies would be fixed at their present level are now being categorically denied by officials.
Saudi Arabia’s Ministry of Labour and Social development has issued a strong denial about the possibility of companies’ expat fees being pegged at their present, initial level. The fees, introduced at the beginning of this year and remitted annually, are paid by companies at a rate of $107 per month for each foreigner employed. If an equal number of Saudis and expats comprise the workforce, the rate is set at $80, with all fees due to increase annually until 2020.
Changes to the levy have been repeatedly called for by the Council of Saudi Chambers, and include exemption for SMEs, monthly rather than annually payments and an extension in the timeline of the increases to the year 2025. The emirate’s construction industry has been hardest hit by the foreign worker levy, with many thousands of expat workers quitting Saudi Arabia earlier this year as a result. It’s feared the announcement the levy will stay in place as it is will cause another mass exodus, thus damaging other industries and causing small businesses to close down. Reasons for leaving were given as cancellations of contracts by cash-strapped private sector employers unable to afford the new tax.
Meanwhile in Kuwait, the Finance Ministry has ordered all state departments to put together lists including numbers of Kuwaiti workers as well as industries where expat workers can be replaced by Kuwaiti nationals. The lists must be completed by March next year in order for the ministry to announce plans to continue its push towards Kuwaitization, and are needed to complete an e-government system aimed at reducing the manpower needed to keep track of the process. A significant drop in the numbers of employees is expected, with both Kuwaitis and expats affected by the resulting job cuts.
Saudi Arabia’s Ministry of Labour and Social development has issued a strong denial about the possibility of companies’ expat fees being pegged at their present, initial level. The fees, introduced at the beginning of this year and remitted annually, are paid by companies at a rate of $107 per month for each foreigner employed. If an equal number of Saudis and expats comprise the workforce, the rate is set at $80, with all fees due to increase annually until 2020.
Changes to the levy have been repeatedly called for by the Council of Saudi Chambers, and include exemption for SMEs, monthly rather than annually payments and an extension in the timeline of the increases to the year 2025. The emirate’s construction industry has been hardest hit by the foreign worker levy, with many thousands of expat workers quitting Saudi Arabia earlier this year as a result. It’s feared the announcement the levy will stay in place as it is will cause another mass exodus, thus damaging other industries and causing small businesses to close down. Reasons for leaving were given as cancellations of contracts by cash-strapped private sector employers unable to afford the new tax.
Meanwhile in Kuwait, the Finance Ministry has ordered all state departments to put together lists including numbers of Kuwaiti workers as well as industries where expat workers can be replaced by Kuwaiti nationals. The lists must be completed by March next year in order for the ministry to announce plans to continue its push towards Kuwaitization, and are needed to complete an e-government system aimed at reducing the manpower needed to keep track of the process. A significant drop in the numbers of employees is expected, with both Kuwaitis and expats affected by the resulting job cuts.
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