UAE said to mull remittance tax on expats

A member of the UAE’s Federal National Council on Tuesday called for foreign workers to be taxed on the billions of dirhams they send back to their home countries each year.

Umm Al Quwain member Ali Jasem reportedly told council on Tuesday: “The Federal National Council and the Ministry of Finance should produce a package of creative measures to bolster the country’s revenues, including a tax on remittance of the billions of dirhams which foreign workers send back to their home countries every year.”

A fee collection system would have to be developed to ensure such a levy is properly implemented and collected, Jasem added.

He made the comments as the council was debating audit reports from 2012 and 2013, according to a report in Gulf News.

Obaid Humaid Al Tayer, the minister of state for financial affairs, later declined to comment on whether authorities would proceed with the tax. The

“Government may not comment on issues of such significance before they are throughly studied in terms of their socioeconomic impacts,” he was quoted as saying.

Introducing a remittance tax on expats working in the UAE would have a significant impact, potentially raising costs in the economy and reducing the supply of foreign labour, the newspaper reported.

However, it added that the proposal nonetheless reflects growing concern in the UAE over declining oil revenues and the need to retain as much of the wealth generated within the country as possible.

http://www.arabianbusiness.com/uae-said-mull-remittance-tax-on-expats-594878.html