As part of efforts to achieve financial balance, the Kingdom in the middle of 2017 started levying fees on expatriate employees and their family members living in the country.
The expat fee was aimed at encouraging the Saudization of jobs and to close the wide gap between the costs of employing Saudis and expats in the private sector. This initiative was also meant to attract and retain skilled foreign labor with high qualifications, especially as 84 percent of the expat workers in the Kingdom did not have even a high school education.
The move also aimed at getting a clear of picture of the total expatriate population and the exact number of the foreign workers in the country. It was also meant to support the government financially because the new fee was expected to generate billions of riyals in state revenue.
It was also expected that new fee would lead to an exodus of expatriates from the country, easing the pressure on the infrastructure and cutting down remittances abroad.
The fee, along with the security sweep against illegal residents through the Interior Ministry's "A Country Without Illegals" campaign caused many expats to leave the Kingdom for good. This played an important role in lowering the cost of renting while a number of shops in some of the city centers were vacated.
No one can deny the role of expatriates in our social life. They became a part of Saudi society, especially the ones who were born and raised in this country and those who have their families with them. Many of these people do not know any homeland other than Saudi Arabia. The levy will also help distinguish this segment of expats from the ones who live and work illegally in the country and compete with the Saudis as well as the law-abiding expatriates in jobs.
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There have been several rumors lately circulated through social media on cancelling or amending the expat fee. Each time, the government denied these rumors through official government platforms.
The main goal of the expat fee is to safeguard the interests of the country and its people. The minister of commerce and investment said in a TV interview aired recently that there was a study on expat fees, which would be presented to the economic and development affairs council soon. He affirmed that any decisions taken on the basis of the study would be in the interest of the Saudi citizens.
Before the labor minister's remarks, the minister of finance said at a press conference following the announcement of the 2019 state budget that there was no intention to withdraw or amend the expat fee. He said the government was regularly reviewing all initiatives under the financial balancing program.
If and when it is noticed that the initiative failed to achieve its stated goals, then it will be reviewed, the minister said.
Last month, the minister of labor and social development categorically denied rumors that said expat fees would be lifted or amended.
We should not respond to rumors that are aimed at creating chaos in the labor market, but we must convince the public that these initiatives are for the benefit of the country and the Saudi people.
The Saudi government meanwhile is keen on reviewing any study that aims at achieving the targeted goals of Vision 2030.
By Ibrahim Muhammad Badawood
The views and opinions expressed in this article are those of the author and do not necessarily reflect the views and opinions of Al Bawaba Business or its affiliates.
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