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The proposal for a two percent levy on the billions of rials that expatriates send home every year has been approved by Oman’s Majlis al-Shura, or the lower house of the council of Oman, to overcome a budget deficit due to drop in oil prices, a media report said.

"The approval to tax expatriate remittances is one of the several steps proposed to overcome the budget deficit, which the Sultanate will face while adjusting the oil price," Times of Oman quoted Tawfiq Al Lawati, a Shura member, as saying Sunday.

The move would hit 1.9 million expats, the report said, adding that it may drive an increase in black market money transfers. Â There are around 600,000 Indians working in Oman.

"Every country has right to mobilise income for its development. We cannot say no to their plans. As majority of the expat workers belong to the low-income group, they should be exempted from tax," Umesh Kumar, chairman of the Institute of Chartered Accountants of India’s Muscat Chapter, said.

Kuwait 5-year expat residency cap a step nearer

Bill imposes ban on bringing expatriate’s family into country

Manama: A bill calling for the imposition of a five-year residency cap on foreigners in Kuwait and a ban on bringing their families into the country has been cleared by the parliament’s legal and legislative committee.
 
The bill, submitted by MP Abdullah Al Tamimi, also limits the size of any expatriate community to less than 10 per cent of the Kuwaiti population, now estimated to be 1.25 million. Under the proposal, no community should be larger than 125,000 people.
The Indian community, the largest in the northern Arabian Gulf country, with more than 670,000 members and the Egyptian community, the largest among Arabs with around 520,000 people, would be dramatically affected and thousands of foreigners would have to leave the country.
 
The Bangladeshi, Pakistani, Filipino and Syrian communities among the largest in Kuwait would also see their numbers slashed.

The bill applies to unskilled and semi-skilled expatriates who make up the largest segment of the communities in Kuwait.
 
Excluded categories
 
Highly qualified and skilled expatriates are not included in the proposal promoted by Al Tamimi as seeking to address the alarming demographic issue in Kuwait.
 
The committee also reportedly called for removing the six-month period accorded to expatriates who leave the country before their residency visa is cancelled.
 
Under the bill, foreigners will also be banned from brining their families into the country, Kuwaiti media reported on Monday.
 
GCC, European Union and US citizens as well as consultants and doctors will be exempted from this provision, the committee said.
 
The legal and legislative committee assesses whether the bill is in line with the constitution and laws of the country.
 
Now, it will have to pass the interior and defence committee as the next step in the long process to come into force.
 
If it is passed by the parliamentary panel, it is taken up by lawmakers who debate its merits at the parliament. If it is endorsed, it is referred to the government.
 
Kuwait is home to around 2.5 million expatriates, mainly unskilled Asian labourers in the construction sector and domestic helpers, who make up two-thirds of the total population.
 
Several people have been pressing for addressing the demographic imbalance and reducing the country’s reliance on foreigners.

Labour market reforms

Pushing for an exhaustive reform of the labour market, Dhikra Al Rashidi, the minister of social affairs and labour in June last year pledged to spearhead a campaign to limit the number of unskilled foreigners amid reports that one million will be deported over the next 10 years with an average of 100,000 a year.
 
In February, MP Khalil Abdullah called for the deportation of 280,000 expatriates per year for the next five years to help address the imbalanced demographic in the country.
 
“There is a critical need to find solutions for the demographic situation in Kuwait,” he said.
 
“We need to have a Kuwaiti population that is at least equal to the number of foreigners who live in the country. Since we have 2.5 million expatriates, we need to bring the number down to 1.1 million in the next five years, which means we need to reduce their numbers by 280,000 every year,” he said.
 
However, he said that expatriates “with laudable contributions to the prosperity of the nation and with commendable experience to serve the country and the citizens” should not be included in the mass-deportation plan.
 
The business community has been vigourously resisting the deportation calls, warning that it could result in grave economic issues in the country.