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Wednesday , December 11 2019

Cabinet nod to 10% tax on company profits – Repricing of some commodities, public services approved

KUWAIT CITY, March 14, (Agencies): Kuwaiti Finance Minister Anas Al-Saleh told a press conference on Monday that the Cabinet had approved a plan to impose a 10 percent tax on profits of companies. The Cabinet also approved a repricing of some commodities and public services, he added, without elaborating. Corporate taxes are currently levied at different rates for local and foreign companies, although most Kuwaiti companies do not presently pay taxes on income.

Other charges are levied though: some firms must pay an employment tax and make mandatory contributions for zakat, or Islamic alms, and for a scientific research foundation. Earlier, Anas Al-Saleh submitted a six-point document bearing on financial and economic reforms to the Cabinet.

The document, which was presented to the Cabinet during its customary weekly meeting presided over by His Highness the Prime Minister Sheikh Jaber Mubarak Al-Hamad Al-Sabah, includes 41 short, and medium-term programs, Minister of State for Cabinet Affairs Sheikh Mohammad Abdullah Al-Mubarak Al-Sabah said in a statement following the meeting.

It is mainly based on boosting non-oil revenues, cutting public spending in order to reduce budget deficit, redraw the State’s economic role so that it could gradually turn from production to organization and supervision over economic activities, and reactivating the private sector’s economic role, the minister said.

It also includes allowing people to own privatized projects at a rate of 40 percent and public-private sector joint ventures at a rate of 50 percent, reforming the labor market and civil service system with a view to ensuring justice among workers, improving job performance, boosting the public sector’s efficiency by linking pay to production, maintaining stable living conditions, as well as launching administrative and institutional reforms by means of upgrading the efficiency of general and financial administration, he said.

Central Bank of Kuwait (CBK) Governor Mohammad Al-Hashel briefed the Cabinet on local economic challenges through four aspects involving economic, financial, monetary and bank conditions, the CBK’s role, the State’s sovereign credit rating and financial and economic reforms. He reassured that the current monetary and bank positions are “safe and solid,” noting that the Kuwaiti dinar exchange policy which is based on pegging the dinar to a basket of main world currencies marks the main framework for the CBK’s monetary policy. He reiterated the CBK’s firm commitment to the dinar exchange policy in a way that ensures its stability and purchasing power, citing relevant positive reports by world agencies, primarily the International Monetary Fund (IMF). However, the governor stressed the significance of stepping up efforts to put financial and economic reform programs in place.

At the onset of the weekly meeting, the Cabinet reviewed the outcomes of the recent military drills “North Thunder” in Saudi Arabia, which reflected integration and unity in face of challenges threatening regional security, peace and stability. The Cabinet voiced much satisfaction with the exercises that brought together forces from several Arab and Muslim countries for training in fighting terrorist groups in the region, appreciating the Saudi role in promoting regional peace and stability.

The Cabinet welcomed a visit to be paid by Yemeni President Abed-Rabbo Mansour Hadi to Kuwait tomorrow (Tuesday), wishing him a pleasant stay in the country. Meanwhile, First Deputy Premier and Foreign Minister Sheikh Sabah Al- Khaled Al-Hamad Al-Sabah apprised the Cabinet on the outcomes of the recent meeting of the foreign ministers of the GCC members, Morocco and Jordan in Riyadh. Finally, the Cabinet congratulated former Egyptian Foreign Minister Ahmad Abul-Gheit on having been chosen as new Secretary-General of the Arab League, hailing his capabilities and experience, and thanked outgoing Secretary- General Nabil Al-Araby for his efforts to promote Arab issues.

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