'Saudization' win-win for government
Saudi Arabia's private sector is expected to pay the Ministry of Labor about SAR 10 billion in expatriate fees for this Hijri year, according to ministry sources
The fee, which has been raised from SAR 100 to SAR 2,400 per person, will be imposed on about 4 million expats. Domestic workers and companies with more than 50 percent Saudis are exempted from this resolution, according to Asharq Al-Awsat, the Arabic language newspaper.
The contracting sector will pay most of this bill. Mushabab Mubarak Al-Saad, assistant secretary-general for National Committees in the Council of Saudi Chambers, said that a report on the negative consequences of the resolution of the Ministry of Labor is being prepared.
"Workshops studying the effects of the resolution found no positive trend," Al-Saad said. "All recommendations are about the negative impacts on the Saudi business sector as well as the Saudi subjects."He also said that the rate of inflation will go up in some areas of the Kingdom as a result of this.
The decision came out abruptly, complained Al-Saad. "The Council of Saudi Chambers was absolutely not informed before the resolution was passed," he said.
"The business sector collectively refused the resolution because it was quick and abrupt." Saudi businessmen in the contracting sector refused to comply with the resolution although it came into effect last week. They held a meeting in Riyadh to send a protest note, which will be submitted to object to the ministry's resolution.
Heads of contracting sector committees in the Chambers of Commerce and Industry in Saudi Arabia agreed not to comply with the resolution until it is canceled or closure of their companies, and discharging their employees will be the next step. In addition, Fahd Alhamadi, head of the contractors national committee, said that they took a collective decision not to comply with the resolution.
He told Asharq Al-Alawsat: "Contractors will not pay the new fees because they are illogical and have negative impact on both small and medium companies."Alhamdi said that the closure of many companies is expected.
"We have Saudi employees, but most of our employees are non-Saudis because of the nature of work in this sector."
He also added: "Inflation is rising and such resolution will make it even worse."Meanwhile, protests against the expat fees have flared up in various sectors. Private schools are insisting that citizens bear the burden of this resolution by adding all the expenses to school fees.
A source in the Ministry of Labor, however, said: "Saudization rate in private schools should be more that 50 percent, and their protest against this decision proves their failure to comply with the national policy in a sector largely dominated by expatriate teachers."