Bahraini Businessmen Protest Expat Tax

By Editorial 07 February, 2014

Businessmen in Bahrain have launched a petition for the removal of a tax on expatriate workers, saying that they are still struggling with the aftermath of the financial downturn which hit in 2011.

Public and private companies in the Middle Eastern country are required to pay a BHD10 (USD26.50) fee to the Labor Market Regulatory Authority (LMRA) for every foreign worker they hire. The fee is BHD5 if the company employs fewer than five expatriates.

The foreign worker fees were suspended in April 2011 to alleviate the effects of the financial unrest triggered by a Shia Muslim uprising. However, the fees were reintroduced in August of this year.

On February 04, 2014 a group of businessmen submitted a letter to parliament chairman Khalifa Al Dhahrani complaining that the government did not consult the business community before re-introducing the tax.

At the end of last year Bahrain's Shura Council rejected a parliament bill to overturn the tax for low-income expats. The chief executive of the LMRA warned that reducing the fees according to sector would create instability. He pointed out that requests for expat workers grew 21 percent during the period in which the fees were suspended, and argued that the new proposal would result in companies lying about the salaries of their foreign workers to take advantage of the tax break.

In January the LMRA warned businesses that it would revoke the visas of their expat employees if they fail to pay the tax within four weeks.

Tags: Expatriates | Tax | Business | Employees | Bahrain | Fees | Expats | Middle East |


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