KUWAIT CITY: Kuwaiti politicians are preparing to debate a polarising remittance tax for foreigners working in the country, after it was controversially endorsed by the parliament’s financial and economic affairs committee.The members of the financial committee voted four to one to refer the remittance tax bill to parliament for debate on 17 April, reports regional newspaper Gulf News.
If the draft is approved by the 65-member parliament, it will be sent to the government for final approval before being passed into law.
The tax has polarised politicians in the country, with proponents arguing it will generate much-needed revenue as the country looks to diversify its economy.
Salah Korshid, the chairman of the financial committee, said if passed into law, the tax would generate an extra KWD70m from the average KWD19bn in remittances that leave the country each year.
He said to Kuwaiti publication Al Jarida, that other Gulf Cooperation Council (GCC) countries already have similar laws permitting taxes on remittances.
The GCC is made up of Bahrain, Kuwait, Oman, Saudi Arabia and the UAE.
“Banks and money-changers take fees on remittances, and the government should be the one to take them, especially that the figures that we see make us keener on the money and on the interests of the state,” Korshid said.
Opposition has been equally strong, however, with Kuwait’s Central Bank saying the tax would harm the country’s reputation, lead to financial instability and potentially create a black market for remittances.
