Kuwait Central Bank Opposes Tax On Expat Remittances

by Lorys Charalambous, Tax-News.com, Cyprus

05 May 2017

The Governor of Kuwait's Central Bank has said he opposes calls to introduce a remittance tax in the country, saying that the measure would damage its economy and financial reputation.

Speaking to the Kuwaiti newspaper Al Seyassah, Mohammed Al Hashel said that the negative economic impact of the reform would be greater than any increase in tax revenues.

He said that revenue estimates for the tax would be lower than forecast, given the likely administrative and operational costs, and the expectation that expats would seek out ways to avoid paying the new tax.

Al Hashel added that the tax would create higher costs for consumers and impact foreign investment.

Lawmakers have been considering introducing a tax on expat remittances under proposals to significantly raise taxes on foreigners living and working in Kuwait.

Under the plan, expats would face rates as high as five percent on remittances exceeding KWD500 (USD1,640).

As well as introducing a value-added tax, alongside other Gulf Cooperation Council territories, Kuwait may introduce higher taxes on vehicle use.

TAGS: tax | investment | Kuwait | Gulf Cooperation Council | individual income tax | Expats