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Saturday , January 29 2022

Risk in remittance tax; Money may move underground

KUWAIT CITY, Nov 18: A government study shows the remittances of expatriate workers from Kuwait during last year (2020) was about 12.9 percent of the total GDP with India making the lion’s share with 29.5 percent followed by Egypt with 24.2 percent, Bangladesh third with 9 percent, the Philippines fourth with 4.9%, Pakistan 4.3%, Sri Lanka with 2.1%, Jordan with 1.9%, Iran with 1.3%, Nepal with 1.2%, and Lebanon with 0.8% respective, reports Al-Rai daily.

While there is no Gulf country that imposes direct taxes, the study warned imposing taxes will negatively affect the efforts to enhance monetary and financial stability, since foreigners may resort to making transfers through informal channels and this will pose the risk to efforts to combat money laundering and financing of terrorism and will have negative repercussions on the overall economy in addition to contradicting the obligations of the member states to the International Monetary Fund, and will contradict the vision of Kuwait as a financial and commercial center

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