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Bill to scrap expat levy is rejected

Manama, December 3, 2013

By Mohammed Al A'Ali

Bahrain's Shura Council members yesterday rejected a parliament bill to scrap monthly fees for foreign workers in low paid jobs.

Public and private sector companies have to pay BD10 ($26.2) for every expatriate on their books or BD5 if they employ less than five, said a report in the Gulf Daily News (GDN), our sister publication.

The controversial fees, which earlier spawned protests by small and medium enterprises, were reintroduced in August after being suspended for 28 months to help businesses recover from financial losses caused by the 2011 unrest.

MPs then came up with a bill to scrap the fees in the low-income sector to provide companies with further assistance.

But council members have thrown out the proposal, following a warning from Labour Market Regulatory Authority (LMRA) chief executive Ausamah Al Absi, who claimed reducing the fees based on sectors would cause chaos and threaten the future of the labour market.

"From 2011 until last year, requests for expatriate workers increased by 21 per cent, as many started taking advantage of the fee halt," he said.

"This will happen again with parliament's proposal, because we will see businesses changing their records to include a low-earning sector to get the fee stopped. That will affect the labour market and encourage cheating of the system.

"The Cabinet was right in halving fees on businesses with less than five employees, because they need every fils to continue running as small enterprises, with criteria depending on their size rather than by the sector."

Labour Minister Jameel Humaidan, who is also chairman of the LMRA board, said businesses were already benefiting from halved fees.

"Fishing and gardening and other low-earning professions are benefiting from the halved rates," he told council members.

"If we exempt sectors, then we will have many shifting their scope of operations towards that field. We will see non-deserving companies benefiting, which kills the reason behind initiating the reduced fees in the first place, which is helping people."

Meanwhile, the council postponed discussions on a Royal Decree granting the government half of the LMRA's revenue rather than the existing 20 per cent, for further study. - TradeArabia News Service




Tags: Bahrain | fees | Worker | foreign |

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