Daijiworld Media Network - Jeddah (SP)

Jeddah, Jun 25: Over 4 million Indians currently living in Saudi Arabia are in a tizzy over the newly introduced tax which will target people living here with families. The new tax, 'dependent fee' or 'family tax' is set to hit the families hard. It is gathered that a large number of families are getting prepared to relocate themselves to India.

As per the new rule, commencing July 1, people who are not from Saudi Arabia, have to pay 100 riyals per month per family member to the government in the form of the above tax. The darker side of the law is that this tax will increase at the rate of 100 riyals each year till it touches 400 riyals in 2020. It is said that the nation wants to take stringent measure to buckle up its sagging finances caused by plummeting oil prices. The revised tax regime might force several of the families to earmark almost half of their earnings for paying this tax every month. Already business establishments in the Gulf nation are forced to pay 200 riyals every month per non-Saudi employee hired by them wherever the number of foreign-origin employees crosses local employees. This fee also will go up at the rate of 100 riyals per year till 2020. In the past, the tax was waived in case of businesses which employed less number of foreign-origin employees. This rule has been changed and the taxes will continue to be levied in this case too but at a concessional rate.

As their future will be in jeopardy if they continue to pay such heavy taxes, many Indian men have already sent their families back to their native places, it is learnt.

Saudi Arabia used to attract Indians seeking greener pastures because of tax free income. Of late, conditions have changed, particularly after differences with Qatar surfaced. Falling crude oil prices are making the managements of companies to think of laying off employees to reduce financial burden. Low cost of living, which was another attraction that lured people from other countries, is fast fading out as prices of several commodities are set to rise rapidly in that country.