How the expat levy will impact the Saudi private sector

By June 15, 2017Uncategorized

The planned expat levy in Saudi Arabia will have an impact on the private sector.

It was announced earlier this year, starting in July, the government of Saudi would start collecting a 100 riyal fee for every expat’s dependent, with plans to increase this fee moderately to 400 riyals until 2020.

The 100 riyal per month fee will be applicable on all dependents (spouse, children, parents, in-laws, and domestic workers) residing in Saudi Arabia on an Iqama permit, usually under their father’s or husband’s sponsorship.

Currently, companies that have more expat employees than Saudi locals are charged 200 riyals per month per expat exceeding the number of locals at the end of the current year. The fee will double to SAR400 per month in January 2018, then SAR 600 in 2019 and SAR800 in 2020.

Earlier this year, sources revealed that the fee would be linked to the residency permits and collected in lump sum at the time of their renewal every year.

The Saudi General Directorate of Passports at the Ministry of Interior has announced that residence permits and exit/re-entry visas will not be renewed or issued unless all payments are made in advance. The fees must be paid until the date of validity of their iqama.

Government agencies and banks are updating their digital platforms for collection of the fees.

In the near future, the fee will apply to all private sector companies, even if their expats do not exceed the number of local employees.

The fees on expats and dependents are expected to generate 65 billion riyals for the kingdom by 2020.

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