Expat fee waiver for some small firms extended for three years

Cabinet extended yesterday for three years an exemption on monthly expat fees for “small” firms with nine or fewer employees, state news agency SPA reported yesterday. The set headcount includes the business’s owner, it said.

How the exemption works: The Human Resources and Social Development Ministry clarified the conditions for the exemptions: a waiver of fees on two expat workers if its owner is a full-timer and has his business registered with the General Organization for Social Insurance (GOSI), a waiver of fees on four expat workers if same conditions were met and if the company had at least one Saudi employees among its staff. The exemption aims to support small businesses and ensure their continuity in the labor market, according to the ministry.

Expat levy? The monthly fees have been imposed since 2018 to stimulate a local job creation drive as part of the Kingdom’s diversification plan away from oil. However, the gradually increasing fees have come under fire from businesses on grounds that they drive operating expenses up. Since then, the government has sought measures to help businesses with the cost, including a waiver on fees on expat workers in the industrial sector for five years and an exemption for businesses with a smaller headcount. The imposed fees have led to the mass exit of 1.05 mn foreign workers from the local employment market until 2021, according to government data by Okaz at the time.

Also approved yesterday:

• Mandating the Foreign Minister to sign a MoU to set up he Saudi-Brazil Coordination Council;
• Mandating the Finance Minister to sign a draft agreement with Iceland for the avoidance of double taxation in regards to income tax and prevention of tax evasion;
• A cooperation agreement on crime prevention with Vietnam;
• Two MoUs between the Saudi Data and AI Authority (SDAIA) and Slovenia-based International Research Centre on Artificial Intelligence (IRCAI) and Jožef Stefan Institute in the fields of AI research and development;
• An air transport services agreement with Portugal.