Indians Brace For Saudi Family Tax

Several Indians employed in Saudi Arabia are planning to send their dependants back with the kingdom set to introduce, from July 1, a monthly 'dependant fee' for expats. The fee — 100 riyals (approx. Rs 1,700, as on Tuesday) per month for each dependent — is likely to prove a big financial burden for the Indian expats.

At 41 lakh, Indians form Saudi Arabia's largest expat group. "Some families I know have made plans to return to Hyderabad as they feel they cannot afford to stay there any longer," said Mohd Taher, a computer professional who lives in Dammam. Migrant rights activist Bheem Reddy Mandha said several people had already sent their families back in the past four months. "The men have become forced bachelors," he said.

Saudi Arabia issues the family visa to people with a salary of 5,000 riyals (approx. Rs 86,000) per month. So, an Indian expat living in the country with his wife and two children would have to pay 300 riyals (approx. Rs 5,100) a month.

Moreover, this tax is set to go up by 100 riyals per dependant every year till 2020. This means that, in 2020, a family would have to shell out 400 riyals (approx. Rs 6,900) for each dependant every month. To top it all, this fee has to be paid in advance. For instance if a man's dependant wife is to stay in Saudi Arabia for one year, a total of 1,200 riyals has to be paid in advance at the time of the renewal of the 'iqama' (residence permit).

So, for a family of three dependants (wife and two children), the employee will have to pay an advance tax of 3,600 riyals or around Rs 62,000 per year. While some companies are planning to compensate their employees for the 'dependant fee', most people have no option but pay it themselves.

Asked what effect the 'dependant fee' would have on Indian expats in Saudi Arabia, a senior official in the ministry of external affairs (MEA) said nothing could be said as yet. "But it will affect all expats," the MEA official told TOI.

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