Tax on remittances will generate new income: Al-Kandari

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THE proposal to impose tax on the remittances of expatriates, once approved, will generate huge revenues for the State, MP Faisal Al-Kandari in an exclusive interview with the Arab Times during which he expressed his views on various issues affecting citizens and expatriates. He also talked about the law on new electricity and water fees passed by the Parliament recently, in addition to amendments to the Public Tenders Law and measures being taken to solve the housing problems.

Following is the full text of the interview:

Question: The government promised to grant 12,000 housing units to citizens annually. As chairman of the parliamentary Housing Affairs Committee, please shed light on the measures being taken to fulfill this promise?

Answer: Initially, I must say the housing issue is very sensitive and many Kuwaitis are still on the waiting list to benefit from the housing care project. The government made this promise after the Office of the Parliament conducted a public opinion poll whose result showed that the pressing issue for citizens is housing. The opinion poll was the first of its kind in the history of the Parliament. It was conducted in a bid to determine the top priorities for citizens. My colleagues assigned me to head the Housing Affairs Committee for three years. Thank God, amendments have been made on some laws and new laws have been enacted, because the housing issue necessitates the enactment of a bunch of laws in order to move towards the right direction. There has been a strong and positive cooperation with the government on the housing issue. HH the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah takes serious interest in this issue. HH the Prime Minister Sheikh Jaber Al- Mubarak Al-Hamad Al-Sabah has also instructed the state minister for housing affairs to cooperate with all concerned authorities in solving the housing problems. To this effect, an agreement has been reached to provide 12,000 housing units to citizens every year and the government has actually distributed such number of houses to eligible applicants. This has been done through signing contracts with international companies in charge of infrastructure for housing projects. For the first time in Kuwait, the Engineering Office serves as head of the housing project while the international companies work on the infrastructure. We also have other projects and other contracts underway. We are committed to providing 12,000 housing units to citizens as promised and this is within the priorities of the Parliament.

Q:  It has been reported that since 2013, there has been a plan to assign foreign companies for the construction of housing units in South Al-Mutla but there is still no sign of such projects. Thus, the citizens are looking at this campaign like an illusion or selling fish in water. What is your reaction to this?

A:  At the beginning of July 2016, a contract was signed with an Italian company and Turkish joint venture to implement the first phase of the South Mutla project. We hope these companies will start working soon for the citizens to realize that the government and Parliament are not selling fish in water. Both authorities always keep their promises and put their words into action.

Q:  The Parliament approved the proposal to amend the Public Tenders Law but the government has yet to issue the executive regulations which will pave way for the implementation of the law. How important is this law? When will it be implemented?

A:  The Public Tenders Law has a special nature as it requires looking into technical and specific matters in order to ensure smooth flow of work. In fact, the government is now preparing the executive regulations and the law will be implemented soon. The Parliament takes serious interest in the Public Tenders Law, which has been there for decades without any amendment or development to keep pace with the requirements of a modern country like Kuwait. A lot of amendments have been made on this law. Committees have been set up and experts have been hired to work on it to avoid conflict of interests which happened under the previous law. In addition, the law stipulates establishment of a technical sector to deal with jurisdiction and policies in the Purchasing Department at the Ministry of Finance. The sector will also follow up the activities of the competent purchasing authority, in addition to laying down duties and policies . Moreover, there will be other ways of communication, particularly the use of modern electronic media in the purchasing process. The revised law also stipulates new purchasing methods in line with the latest developments in this field, such as teamwork tenders, electronic practices and agreement on the purchasing framework. The law clearly defines the jurisdiction of authorities and owners of contracting companies. Again, the most important article in the law is changing the tenders into public practices or limited or direct contracts. This will ensure transparency and equality in awarding tenders. I want to reaffirm that the amendments made on the law are in line with the requirements of the modern world.

Q:  You have presented a bill to impose tax on the remittances of expatriates. Why did you submit such a proposal? Kindly explain how this will work and benefits for the State.

A:  I presented this draft law following the example of all other countries. Kuwait is the lowest in terms of collecting fees on remittances. Billions of Kuwaiti dinars are being transferred to other countries, so I presented the proposal for such money to remain here for the benefit of Kuwait. Furthermore, imposing tax on money transfers will generate new income for the government. This will, in turn, guarantee the provision of better services for the expatriates and citizens. I want to add that the income from this tax will not be less than KD20 million per year, considering the minimum amount transferred to other countries is about KD2 billion per year. According to the law, two percent tax will be imposed on remittances below KD100, four percent for remittances ranging from KD100 to KD500 and five percent for remittances above KD500. Tax will be collected through stamps which will be issued by the Finance Ministry and this money will go directly to the State’s treasury. The law mandates the money exchange companies and banks accredited by the ministry to submit receipts in order to guarantee transparency in monitoring and auditing procedures. The law stipulates imprisonment for six months or fine of KD10,000 for anyone who avoids payment of this tax.

Q:  Are you sure that the government and Parliament will approve this bill?

A:  I hope the Parliament will approve it. The parliamentary Legislative and Legal Committee is still studying the proposal. If the Parliament approves it, the government must accept and implement it for the benefit of the country.

Q:  The country is currently facing budget deficit due to the remarkable oil price decline. What could be the alternative to oil as a source of national income? Is the government right in lifting subsidies on some essential commodities and services to address the deficit and to stop the deterioration of the economy?

A:  We are coordinating with the government in the search for other sources of income. Definitely, the government is taking measures to find other sources of revenues rather than depending on oil. The oil price decline has affected the budgets and ongoing projects due to their link with oil revenues. We need to avoid the recurrence of this problem by finding alternative sources of revenues. Lifting subsidies and imposing taxes on certain commodities can be sources of revenues for the State as well, but they should not affect the citizens’ livelihood.

Q:  Electricity and water are necessities of life. Recently, the Parliament and government approved the new electricity and water charges. Is this part of the government’s measures to address the deficit? Have you taken into consideration the impact on citizens and expatriates, especially those with low income?

A:  Kuwait is among those collecting high electricity charges in the Gulf. Therefore, I recommend that government should find other means of rationalizing the use of electricity and water rather than imposing new fees on citizens.

Q:  How do you compare the current Parliament with its predecessors?

A:  The current Parliament deserves praise for setting good examples. So far, it has enacted and amended many important laws such as the laws on tenders, commercial agencies, domestic workers, judiciary, BOT, housing care among others. This is the result of peace and stability in the country as well as the strong cooperation with the government. Although I cannot say this Parliament is perfect, it has done a lot even if it is still facing big challenges left by the previous Parliament which slowed down development and suspended important projects. Under the current Parliament, many mega projects are underway including the construction of seven hospitals. Also, the rate of observations or violations that the State Audit Bureau uncovered in government institutions dropped by 25 percent while in the previous Parliament this rate kept on increasing. The current Parliament will continue monitoring these institutions to correct their mistakes and minimize irregularities.

Q:  Are you satisfied with the performance of the incumbent government, especially in terms of executing the laws passed by the Parliament?

A:  To be frank , the current government has been cooperative, but we hope it will act quickly in implementing these laws.

Q:  Several issues concern the citizens and the country such as health, education, jobs and security. What is your opinion on these issues?

A:  On the security issue, it is obvious that countries all over the world are facing security problems. We see how terrorists are destabilizing many countries. Conferences and meetings are being held to combat terrorism. Kuwait passed many laws to help the military and security agencies in maintaining national security and stability. With regards to the health issue, the government is building many hospitals and establishing health insurance companies. The retirees will soon get health insurance to undergo treatment in private hospitals in Kuwait.

Q:  What is your program for your constituency and the country in general?

A:  The electoral program or platform is not just an empty promise, which some candidates use to stir the feelings of voters. I have adopted many programs including those on housing, domestic workers, health and security. I contributed to the enactment of laws related to these issues. I am keen on following up these issues and ensure that the related laws are implemented properly for the good of the country and its citizens.

Biography: MP Faisal Mohammed Al-Kandari was born in 1970. He holds a masters degree in business administration. He worked as assistant CEO in Al-Bilad Real Estate Investment Company. He is affiliated to Kandari tribe and was a member of the annulled December 2012 Parliament. At the time, he joined the Economic and Financial and Legal and Legislative committees. In the July 2013 parliamentary election, Al-Kandari won third place in the Fifth Constituency with 2,977 votes. In the current parliament, he was elected Chairman of the Housing Affairs Committee and a member of the Economic and Financial Affairs Committee. During the previous Parliament, he and MPs Yousef Al-Zalzalah, Ahmed Lari, Nasser Al-Murri and Mohammed Al-Jabri presented a proposal to establish a public stock company for manufacturing and importing building materials which will be sold to citizens at low prices or on installment with low-interest. Separately, Al-Kandari submitted a draft law on granting farmers interestfree loans to enable them to develop their agricultural projects, since this will benefit the economy and support local agricultural products.

By Abubakar A. Ibrahim Arab Times Staff

This news has been read 6501 times!