Kuwait's top lawmakers proposed a new legislation to impose a fee on foreign remittances, despite being warned by the government and central bank that the bill would be counter-productive.
The parliament’s financial and economic affairs committee voted four to one on Sunday to pass the bill, which will be subject to National Assembly discretion before moving to the government for approval.
The Central Bank of Kuwait advised against the move saying the law could weaken the financial stability of the country and bolster the black market for remittances, according to local sources.
The law stipulates that those making up to KD99 (Dh1,214) would be subject to a one per cent fee; the KD100 to KD200 segment to two per cent; the KD300 to KD499 bracket will be taxed three per cent, and those making more than KD500 will be taxed five per cent.
The council opted not to include the Kuwaiti government’s suggestion that the law be applied to both residents and citizens.
Salah Khorsheed, an MP who serves as head of the financial committee, said the decision to propose the bill was made only after analysing both the humanitarian and legislative aspects of the proposed law.
“Our intention was to make sure that the fee on the lowest-income earners bracket would be much less than those who are higher to ensure that those making more would be compelled to reinvest their earnings in Kuwait,” he said.
Mr Khorsheed predicts that the fee could amount to KD70 million from remittances. He said the committee found that approximately KD19 billion was sent abroad over the last five years.
The MP argued that the proposed fees would not create a black market for remittances and that those suggesting it were guilty of complacency and failed to understand the purpose of financial institutions.
“Why do we have a central bank, why do we have financial regulation, why do we have employees? To make excuses and say it’s out of our hands?” asked Mr Khorsheed.
“That’s why we have a penalty for those who fail to comply. You’re talking about money laundering.”
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Read more:
Kuwait and Philippines strike domestic worker deal
Domestic workers still face 'abuse and fraud' in the Middle East says leading UN body
Murder shocks Filipinas in Kuwait, but some vow to stay
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The proposed bill stipulates that anyone who attempts to circumnavigate the fee could receive up to five years in jail and a fine of twice the amount illegally sent abroad.
The move was justified as one of many proposals coming out of parliament to diversify Kuwait’s economy, as it continues to cope with its dependency on oil revenue.
A source in the ministry of finance said the lack of transparency is the financial institution’s main concern.
"Show us the research you used to make your 'informed decisions’ and let the public scrutinise it,” said the source, who asked to remain anonymous.
“They’re trying to put a band aid on wounds that require stitches. Some members of parliament who are targeting foreigners should be spending their time targeting the policies that got us into this situation in the first place,” he said.
Kuwait announced their annual budget in January with a huge $17 billion (Dh62.4 billion) deficit.
The parliament, which has 24 opposition members out of a total of 50, has been tackling government policies and proposing new legislative reforms attempting to restrict the cabinet's ability to impose added fees on citizens.
Austerity measures in Kuwait have been curtailed by outspoken members of parliament like Safaa Al Hashem, who is also a member of the financial and economic affairs committee.
Last year, she criticised government efforts to save money by increasing energy costs in a country with one of the most heavily subsidised utilities prices.
Several members of parliament have framed solutions to the national deficit at the expense of foreigners living in the country by proposing bills they believe would be perceived as popular among their exclusively Kuwaiti constituents.
The law is not exclusive to Kuwait. The UAE, Saudi Arabia and Bahrain all impose fees on remittances.
Kuwait is home to one of the largest Filipino expatriate communities with 250,000 mostly working in the service sector.
Philippines president Rodrigo Duterte in February announced a ban on maids looking to work in Kuwait after the body of a murdered Filipina was discovered in a freezer.
A Kuwaiti court on Sunday sentenced a Lebanese man and his Syrian wife to death over her murder.
Kuwait, having struck a deal with the Filipino government last month, is looking to raise the minimum wage of Filipino workers in the country to $400 a month.
Mobile phone packages comparison
From Zero
Artist: Linkin Park
Label: Warner Records
Number of tracks: 11
Rating: 4/5
COMPANY%20PROFILE%20
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The specs
Engine: 3.5-litre twin-turbo V6
Power: 380hp at 5,800rpm
Torque: 530Nm at 1,300-4,500rpm
Transmission: Eight-speed auto
Price: From Dh299,000 ($81,415)
On sale: Now
THE SPECS
Engine: 3.6-litre V6
Transmission: nine-speed automatic
Power: 310hp
Torque: 366Nm
Price: Dh200,000
TECH%20SPECS%3A%20APPLE%20WATCH%20SERIES%209
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Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
If you go
Where to stay: Courtyard by Marriott Titusville Kennedy Space Centre has unparalleled views of the Indian River. Alligators can be spotted from hotel room balconies, as can several rocket launch sites. The hotel also boasts cool space-themed decor.
When to go: Florida is best experienced during the winter months, from November to May, before the humidity kicks in.
How to get there: Emirates currently flies from Dubai to Orlando five times a week.
Farasan Boat: 128km Away from Anchorage
Director: Mowaffaq Alobaid
Stars: Abdulaziz Almadhi, Mohammed Al Akkasi, Ali Al Suhaibani
Rating: 4/5
COMPANY PROFILE
Founders: Alhaan Ahmed, Alyina Ahmed and Maximo Tettamanzi
Total funding: Self funded
'Project Power'
Stars: Jamie Foxx, Joseph Gordon-Levitt, Dominique Fishback
Director: Henry Joost and Ariel Schulman
Rating: 3.5/5
THE SPECS
Aston Martin Rapide AMR
Engine: 6.0-litre V12
Transmission: Touchtronic III eight-speed automatic
Power: 595bhp
Torque: 630Nm
Price: Dh999,563
FIXTURES
Nov 04-05: v Western Australia XI, Perth
Nov 08-11: v Cricket Australia XI, Adelaide
Nov 15-18 v Cricket Australia XI, Townsville (d/n)
Nov 23-27: 1ST TEST v AUSTRALIA, Brisbane
Dec 02-06: 2ND TEST v AUSTRALIA, Adelaide (d/n)
Dec 09-10: v Cricket Australia XI, Perth
Dec 14-18: 3RD TEST v AUSTRALIA, Perth
Dec 26-30 4TH TEST v AUSTRALIA, Melbourne
Jan 04-08: 5TH TEST v AUSTRALIA, Sydney
Note: d/n = day/night
Squid Game season two
Director: Hwang Dong-hyuk
Stars: Lee Jung-jae, Wi Ha-joon and Lee Byung-hun
Rating: 4.5/5
Notable groups (UAE time)
Jordan Spieth, Si Woo Kim, Henrik Stenson (12.47pm)
Justin Thomas, Justin Rose, Louis Oosthuizen (12.58pm)
Hideki Matsuyama, Brooks Koepka, Tommy Fleetwood (1.09pm)
Sergio Garcia, Jason Day, Zach Johnson (4.04pm)
Rickie Fowler, Paul Casey, Adam Scott (4.26pm)
Dustin Johnson, Charl Schwartzel, Rory McIlroy (5.48pm)
KLOPP%20AT%20LIVERPOOL
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COMPANY%20PROFILE
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RACE CARD
6.30pm: Handicap (TB) $68,000 (Dirt) 1,600m
7.05pm: Meydan Sprint – Group 2 (TB) $163,000 (Turf) 1,000m
7.40pm: Curlin Stakes – Listed Handicap (TB) $88,000 (D) 2,200m
8.15pm: UAE Oaks – Group 3 (TB) $125,000 (D) 1,900m
8.50pm: Zabeel Mile – Group 2 (TB) $163,000 (T) 1,600m
9.25pm: Balanchine – Group 2 (TB) $163,000 (T) 1,800m
10pm: Al Shindagha Sprint – Group 3 (TB) $130,000 (D) 1,200m
Frankenstein in Baghdad
Ahmed Saadawi
Penguin Press
Ticket prices
- Golden circle - Dh995
- Floor Standing - Dh495
- Lower Bowl Platinum - Dh95
- Lower Bowl premium - Dh795
- Lower Bowl Plus - Dh695
- Lower Bowl Standard- Dh595
- Upper Bowl Premium - Dh395
- Upper Bowl standard - Dh295
The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
COMPANY%20PROFILE
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UAE currency: the story behind the money in your pockets
Turkish Ladies
Various artists, Sony Music Turkey
COMPANY%20PROFILE
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The specs: 2018 Kia Picanto
Price: From Dh39,500
Engine: 1.2L inline four-cylinder
Transmission: Four-speed auto
Power: 86hp @ 6,000rpm
Torque: 122Nm @ 4,000rpm
Fuel economy, combined: 6.0L / 100km
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
How to protect yourself when air quality drops
Install an air filter in your home.
Close your windows and turn on the AC.
Shower or bath after being outside.
Wear a face mask.
Stay indoors when conditions are particularly poor.
If driving, turn your engine off when stationary.
Virtual banks explained
What is a virtual bank?
The Hong Kong Monetary Authority defines it as a bank that delivers services through the internet or other electronic channels instead of physical branches. That means not only facilitating payments but accepting deposits and making loans, just like traditional ones. Other terms used interchangeably include digital or digital-only banks or neobanks. By contrast, so-called digital wallets or e-wallets such as Apple Pay, PayPal or Google Pay usually serve as intermediaries between a consumer’s traditional account or credit card and a merchant, usually via a smartphone or computer.
What’s the draw in Asia?
Hundreds of millions of people under-served by traditional institutions, for one thing. In China, India and elsewhere, digital wallets such as Alipay, WeChat Pay and Paytm have already become ubiquitous, offering millions of people an easy way to store and spend their money via mobile phone. Indonesia, Vietnam and the Philippines are also among the world’s biggest under-banked countries; together they have almost half a billion people.
Is Hong Kong short of banks?
No, but the city is among the most cash-reliant major economies, leaving room for newcomers to disrupt the entrenched industry. Ant Financial, an Alibaba Group Holding affiliate that runs Alipay and MYBank, and Tencent Holdings, the company behind WeBank and WeChat Pay, are among the owners of the eight ventures licensed to create virtual banks in Hong Kong, with operations expected to start as early as the end of the year.
COMPANY%20PROFILE
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Dengue%20fever%20symptoms
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Our House, Louise Candlish,
Simon & Schuster
UAE currency: the story behind the money in your pockets
COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
David Haye record
Total fights: 32
Wins: 28
Wins by KO: 26
Losses: 4
First Person
Richard Flanagan
Chatto & Windus
ANATOMY%20OF%20A%20FALL
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Company%20Profile
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