Expats in Saudi Arabia welcome call for business fees for hiring them to be proportionate to wages

However they say the proposal by a Shoura Council member should also include the monthly fees they pay for dependents

  
People follow social distancing markings as they line up at a shopping mall after the Saudi government eased a curfew and allowed stores to open, following the outbreak of the coronavirus disease (COVID-19), in Riyadh, Saudi Arabia May 2, 2020.

People follow social distancing markings as they line up at a shopping mall after the Saudi government eased a curfew and allowed stores to open, following the outbreak of the coronavirus disease (COVID-19), in Riyadh, Saudi Arabia May 2, 2020.

REUTERS/Ahmed Yosri
 
RIYADH: Expatriate workers in Saudi Arabia on Thursday welcomed official calls for the fees businesses pay to hire foreigners to be revised so that they are proportionate to employees’ wages.

However they said that the fees expatriates themselves have to pay for dependents who live with them in the Kingdom should also be reviewed so that they, too, are wage proportionate.

The proposal for proportionate fees came this week from Hazza Al-Qahtani, a member of the Shoura Council. He said that the charges have become an obstacle to growth for small and medium enterprises in the Kingdom and need to be reviewed to help reduce their operating costs and ensure growth and sustainability.

In January 2018, Saudi Arabia introduced a fixed monthly fee, payable when a work permit (iqama) is extended, of SR400 ($107) for each foreign worker a business hires. It was reduced to SR300 for those that employ at least as many Saudis as expatriates. It increased to SR600 or SR500 in 2019 and to SR800 or SR700 last year.

Sultana Al-Badawi, also a member of the Shoura Council, said SMEs are facing challenges because of the financial burdens imposed on them and the administrative requirements dictated by a number of official bodies. She called for a review of procedures and an assessment the impact they have on the establishments.

Expatriates in the Kingdom said that they hope the fixed fees that they have to pay for their dependents living in the Kingdom will also be reviewed and made proportional to their wages.

Faiz Al-Najdi, a Pakistani expatriate working in Yanbu told Arab News: “What I understand is that it is a proposal to provide relief to the SMEs, which as of this year have to pay SR800 for each foreign worker before renewal of the iqama.”

But, he added, this will not provide any financial relief for the expatriate workers themselves, who have to pay SR400 a month for each family member living with them in the Kingdom. “It would be indeed a great relief to them if this levy is reduced or made proportional to income,” said Al-Najdi.

Raafat Aoun, a Lebanese national living in Jeddah, told Arab News that he has been waiting for almost two years for an announcement that the dependent fees will be abolished or reduced.

“It is good that a Shoura Council member is proposing to make expatriate fees proportional to income, but it should be both for companies and the expatriates who are paying for family dependents,” he said.

He said that both fees are huge financial burdens and added: “It is affecting the business of the SMEs. It is also not viable for expatriates to keep their families in the Kingdom. Decisions to reduce it or make it proportional to income will surely energize business activities and so add to the gross domestic product of the Kingdom, though I would prefer the expatriates fee to be abolished.”

Mohammad Arshad Ali Khan, a teacher at International Indian Public School in Riyadh, also welcomed the proposal.

“Saudi Arabia is a second home for all expatriates and we are looking for a favorable humanitarian decision from the Kingdom of humanity, which is undergoing changes as part of Crown Prince Mohammad bin Salman’s ambitious economic and social reforms,” he told Arab News.

Copyright: Arab News © 2021 All rights reserved. Provided by SyndiGate Media Inc. (Syndigate.info).

Disclaimer: The content of this article is syndicated or provided to this website from an external third party provider. We are not responsible for, and do not control, such external websites, entities, applications or media publishers. The body of the text is provided on an “as is” and “as available” basis and has not been edited in any way. Neither we nor our affiliates guarantee the accuracy of or endorse the views or opinions expressed in this article. Read our full disclaimer policy here.

More From Policy