Kuwait: Proposed fees on expatriate remittances and increases in residency fees come closer to fruition
A bill to tax expatriate remittances has been approved by Kuwait's Financial and Economic Affairs Committee, and now awaits approval by the Parliament at large.
The proposed fees are staggered by salary. A 1% fee would be charged to workers earning KD90 per month or less, 2% on KD100-200, 3%KD 300-499 and 5% on KD500+.
Penalties entail a maximum KD 10,000 fine and five years imprisonment. The fine is equal to twice the amount remitted if the money is transferred through a channel other than the approved exchange companies and banks.
The draft bill has elicited criticism from owners of exchange companies as well as the Central Bank, who warn that the tax will push remittances to the black market.
Meanwhile, a bill to increase residency fees for expatriate workers is also close to being referred to Parliament. The Residency Affairs Department has recommended fee increases ranging from 50 to 100% for all services, including resident permits, family visas, and transit visas among others.
Both moves come as Kuwait attempts to increase its non-oil revenue and diversify its economy.