Yet another major setback to Millions of Expatriates in the Kingdom after revise Visa fee earlier this year. Now During the Announcement of New Saudi Budget 2017 Kingdom didn’t impose any income or remittance tax on Expatriate which is might be Good News but after the introduction of Monthly fee on dependents and companies the Good news washed away. The conditions of expatriate in Saudi Arabia is fairly calm until when crude oil prizes start to become lower. The lowering oil prizes push KSA and other gulf countries to start implementing fees and taxes on citizens as well as Expatriates.
It is obvious new Monthly fee makes a huge difference in daily life of Expatriates in Kingdom especially those living with their families. Expatriates in Saudi Arabia is mostly from South Asia, many of them were laborers but their is fair amount of highly professional expats were also from south Asian Countries. All of them were working in Saudi Arabia for one reason that is to send money back to their homes so that their families can fulfill their basic Need. One more reason is that labour wages or daily wages in South Asia is far less than Gulf countries which also turn them to visit Gulf Countries.
After the launch of Saudi Budget 2017 it is now confirm from Arab news and Saudi Gazette as well as Okaz that the new Monthly fee starts from July 2017 and than increases every year until year 2020. Today we analyze how these fees effects on expatriates and their families in terms of riyals.
According to few resources these new fees will be collected along with the renewal of Iqama. However Saudi Passport Department Jawazat still waiting for more instruction regarding collection of these fees and its mechanism.
In below table we suppose family member or Dependents up to 5 member here the result we got. The number shown below are in Saudi Riyals
The above for Individual expatriates sponsors, companies, org, private sector, employer also have to pay fee in according to the number of expatriates or Saudis working under them let see what is the result.
Member of the Riyadh Chamber of Commerce and Industry
The new fee on expatriates will create burden on private sector, above fees which will kink start on just after few months in July. This fee will enhance the financial burden no only for expatriates buttheir families, companies and employers, according to member of Riyadh Chamber of Commerce and Industry.
The fee will generate revenue of SR 65 Billion by 2020 but not without any adverse effects on all around the kingdom. The fee put pressure on contractors, builders, materials, food and consumer product and increase prizes. Kingdom will no more attractiver for work.
Real estate sector might start begnning to collapse as people send their families back to home country flats, houses and shops will be empty from customers.
It is good to mention that multicultural people were working in KSA each have their own place to eat food, buying goods, shopping and clothes and most of these businesses were operated by Saudis so this is setback for them also.
Many expatriates have huge job experience and skills if they leave private sector suffers.
Maghlouth suggests that instead of implementing fee generate such a mechanisms that every expat must have to invest part of their salary within kingdom and encourage them to spend within the kingdom. However there are extra expats laborers residing within the country which we don’t need. These extra worker are burden on Saudi Economy and tries to fulfill the opening positions which can be given to Saudi Nationalist. Source saudigazette.com.sa