Saudi Expat Remittances Should Not Exceed Amount of Salary – Finance Ministry

In an effort to control and support the local economy, the Saudi government, through the Ministry of Labor, is planning to roll out a new rule that will control the amount of money being transferred outside the country. This then means that foreigners living and earning in the country will be highlighted, with every one of their transactions being closely monitored.

To the above effect, a statistical report is to be prepared showing how much an expatriate earns as compared to how much they transfer out of the country. In the ideal situation, and as per the law, an expatriate should not send out more money that what he earns. The population of Saudi Arabia is such that in every ten employees, 9 are expatriates. In fact, statistics show that there are about 11 million expatriates in Saudi, which makes up about 30% of the workforce. Most of their income seems to be flowing out and into India, Bangladesh and Pakistan mostly. As such, this rule is targeted at protecting the country’s economy because money sent out is not taxed.

Ideally, this plan is bound to reset a lot of money back into the economy of Saudi, that is according to the Minister of Labor, Adel Fakih. In the same breath, such illegal activities as smuggling, illegal and unlicensed businesses will be stopped when this rule is put into action.

To the same effect, the government is encouraging job creation for citizens as opposed to expatriates. There are a number of laws that have actually been put in place to replace expatriate workers with citizens making many lose prestigious jobs in the private sector as well as government jobs. This has forced many expatriates to look for jobs in other industries, while others lose their jobs completely. For instance, 10,000 foreigners lost their jobs last year alone.

One strategy that the government wants to adopt is monitoring expatriates bank transactions through one network. This makes it easy to monitor their income and flow of money.

Much as this may be good for many citizens in Saudi whose jobs may have been threatened by more experienced and qualified expatriates, this will make millions of expatriates suffer. Though they have salaried jobs, many of these have legal side jobs whose income may not be recorded but keeps them going. This would mean that they let go of these in a bid to protect their taxable jobs.

 

h/t Arab News 

 

These Airline Companies in KSA Are Giving Away FREE Baggage Allowance. Know How Much You Are Getting

These Airline companies in Saudi Arabia have allocated allowable hand carry and check in luggage allowances. Now, if you are traveling to or from the country, make sure to get an update from the airline site momentarily. Here’s a quick guide on these baggage allowances. Feel free to add your comment so everyone will be updated.

Air India :
– Economy (30Kg Baggage + 8Kg Cabin Luggage)
– Business (40Kg Baggage + 8Kg Cabin Luggage)
– First Class (50Kg + 8Kg Cabin Luggage only for Riyadh, Jeddah)

Emirates :
– Economy Class (35Kg Baggage + 7Kg Hand Luggage)
– Business Class (40Kg Baggage + 7Kg x2 Hand Luggage)
– First Class (50Kg Baggage + 7Kg x2 Hand Luggage)

Etihad Airways :
– Economy Class (23Kg + 23kg Baggage + 7Kg Cabin Luggage)
– Business & First Class (32Kg + 32Kg Baggage + 12Kg Cabin Luggage)

Gulf Air :
– Economy Class (30Kg Baggage + 6Kg Hand Luggage)
– Falcon Gold (40Kg Baggage + 9Kg Cabin Luggage)
– Infant (10Kg Baggage + 3Kg Hand Luggage)

Oman Air :
– Economy Class (30Kg Baggage + 7 Kg Hand Luggage)
– First Class (30Kg + 20Kg Baggage + 7Kg x2 Cabin Luggage)

Pakistan International Airlines :
– Economy Class (40Kg only Baggage from KSA)
– Business Class (45Kg Baggage only from KSA)

Philippine Airlines :
– Economy Class (23Kg x2 Baggage + 7Kg Hand Baggage )
– Business & First Class (32Kg x2 Baggage + 7Kg Cabin Luggage)

Qatar Airways :
– Economy Class (30Kg Baggage + 7Kg Cabin Luggage )
– Business Class (40Kg Baggage + 15Kg Cabin Luggage )
– First Class (50Kg Baggage + 15Kg Cabin Luggage)

Saudi Airlines :
– Economy Class (23Kg x2 Baggage + 7Kg Cabin Luggage)
– Business & First Class (32Kg x2 Baggage + 9Kg Cabin Luggage)

Srilankan Airlines :
– Economy Class (30Kg Baggage + 7Kg Cabin Luggage)
– First & Business Class (40Kg Baggage + 7Kg Cabin Luggage)

 

Gasoline Prices in Saudi Will Rise up to to 90% this November

Saudi Arabia is considering a plan to phase out subsidies for gasoline and jet fuel in November at the latest, as the world’s biggest oil exporter pushes a program to curtail spending after a global slump in prices.

 The government would boost gasoline to parity with varying international prices under the plan, according to a person with knowledge of the matter. At current levels, this could result in a hike of about 80 percent for octane-91 grade gasoline to about 1.35 riyals per liter (0.36 cents), the person said on condition of anonymity. The government plans to delay increases in other energy prices until early 2018, the person said.

Authorities are expected to make a final decision on the plan in September or October, the person said. The Saudi finance, economy and energy ministries didn’t immediately respond to requests for comment.

Energy-subsidy reform is a key part of Saudi Arabia’s plan to overhaul the economy, along with the sale of stakes in state-owned entities, including the world’s biggest crude exporter known as Saudi Aramco. The kingdom raised fuel prices in December 2015 and announced plans for further increases. Authorities have also announced plans for a cash transfer program that would start before further subsidy cuts to help Saudis cope with the impact as the economy struggles with the worst slowdown since the global financial crisis.

“It is important for the Saudi government to cut subsidies in order to ease pressures on budget deficit,” Tariq Qaqish, managing director of the asset management division at Mena Corp. Financial Services LLC in Dubai, said. “Not only the transportation and logistics sectors will be affected significantly, any company that is involved in production and needs to transfer their end products to consumers will be affected.”

Political Sensitivity

The kingdom’s benchmark Tadawul All Share Index climbed 0.3 percent at 12:57 a.m. in Riyadh on Monday. The transportation index fell 0.7 percent, the most in a month.

Removing energy subsidies is politically sensitive in the six-nation Gulf Cooperation Council, where many nationals have grown accustomed to generous state benefits and handouts. The slump in revenue from oil exports have left governments with few options as they grapple with rising budget deficits.

Saudi Arabia’s budget gap soared to more than 15 percent of economic output in 2015 before authorities unveiled a plan to transform the economy and balance the budget by 2020.

The neighboring United Arab Emirates became the first country in the oil-rich region to remove subsidies on transport fuel when it began linking gasoline and diesel prices to global oil markets in August 2015.

Gasoline and jet fuel would undergo immediate, one-time increases under the Saudi plan, while the government would raise prices of other fuels gradually between 2018 and 2021, the person said.

Diesel, Heavy Fuel

The government may put a ceiling on increases in diesel and heavy fuel oil to limit any negative impact on the economy, as both fuels are used for power generation and industrial activities, the person said. Electricity rates would rise gradually as power providers passed on at least some of the increase in fuel prices, the person said.

Benchmark Brent crude has lost about 2 percent this year and was trading at $55.63 a barrel on Monday at 11:22 a.m. in London.

“The government is taking its first step in removing subsidies for some fuel,” said John Sfakianakis, director of economics research at Gulf Research Center. “And over the long term, the economy will become a more efficient user of energy in general, and gasoline in particular.”

h/t Bloomberg

 

Expats Will Lose Their Jobs in Saudi Arabia’s Vision 2030, For One Important Reason

According to some reports, the number of expatriates working in Saudi is said to be on the “alarming” state. As such, the Saudi government has a new policy dabbed “Saudi First” through the Nitiqat System, which will ensure that only a few highly ranked companies can renew work visas for expatriates. This rank, however, will be based on the number of Saudi citizens working for the company. The higher the number of

This rank, however, will be based on the number of Saudi citizens working for the company. The higher the number of citizen workers, the higher the rank of the company.

For the longest time, Saudi Arabia has been dependent on the oil industry. The government now wants to secure its economy through job creation for locals. This will obviously be achieved by blocking visas for expatriates. As a result, the government become less dependent on oil-based industries and will improve focus on broad-based investments.

The other way of getting rid of expat workers is through the new levy fees that will take effect come 2018. Fewer companies will want to risk the charges that come with hiring expatriate workers. On top of this, expatriates will suffer a 5% VAT increase making it practically impossible to survive and save while working here. On the same breath, all expatriate business people who run their businesses under the names of Saudi citizens will also suffer huge consequences once caught, according to the Nitiqat System.

Since it is evident that the future holds little to no space for the need for oil, Saudi wants to ensure that their economy does not disintegrate with the lack of oil use. This is why the government insists on creating some income form the local workforce; something which will not happen if expatriates continue being the bigger part of the workforce.

 

Christmas and Birthdays Are Forbidden in Saudi Arabia. But Here’s What You Can Do.

Being a purely Muslim country, Saudi Arabia has a strict ban for Christian celebrations such as Christmas. This is to the level where even a Muslim cannot wish a Christian a Merry Christmas as it goes against the Muslim belief that Allah did not give birth nor was he born as stated in the Quran. The best a Christian in Saudi Arabia can get during Christmas is a simple “Happy Holiday!” or a gift that has no mention of Christmas.

The best a Christian in Saudi Arabia can get during Christmas is a simple “Happy Holiday!” or a gift that has no mention of Christmas.

If you’re thinking this is a bias against Christians, it really is not. It’s just a blanket approach on all new age religious celebrations. See, much like the Christian celebration of Jesus’ birth did not start until almost three centuries after His death; the Muslim celebration of Prophet Mohammed also did not start until four centuries after his death. This too is therefore forbidden in Saudi Arabia.

The Muslim celebration of was actually adopted from Egypt, where an actual date was formulated and set as his birthday. This is much like Christmas for Christians as this too was started by Dr. Bilal Philips where the actual date was chosen. So as far as Saudi Arabia is concerned, neither of these celebrations are authentic to either religion and therefore bear no real meaning to the state.

So as far as Saudi Arabia is concerned, neither of these celebrations are authentic to either religion and therefore bear no real meaning to the state.

So the next time you’re in Saudi around the Christmas season, watch your tongue and keep your celebration to a low-key minimum. Also, fret not, you can still celebrate birthdays and Christmas at the comfort of your home. It’s Ok. Just make sure that you do not make any loud noise that can disturb your neighbor and please, no illegal materials/acts present in the event.

 

Expats Are No Longer Allowed To Work in Public Sectors By 2020 – Ministry of Civil Service

According to an article published by Saudi Gazette, Deputy Minister of Civil Service, Abdullah Al Melfi, alerted the public that tno expatriate will be expected to be working in government sectors by the year 2020. This is meant to work towards achieving the National Transformation Program’s goal of achieving a government workforce made up of 100% Saudi citizens. This literally means that not a single foreigner will be hired to work in the government by 2020. How did this come to be?

This is meant to work towards achieving the National Transformation Program’s goal of achieving a government workforce made up of 100% Saudi citizens. This literally means that not a single foreigner will be hired to work in the government by 2020. How did this come to be? Are you ready for this?

“The complete nationalization of the government jobs is an important objective of the National Transformation Program 2020 and the Kingdom’s Vision 2030,” Malfi said.

Well, this is a goal that the National Transformation Program has been working towards in order to ensure that the entire government sector features Saudi citizens only. On the side note, STC, Aramco, Mobily, local banks have majorly implemented this in the private sector, it’s not shocking if this will be implemented as well, in the public sector.

By last year, the number of expatriate workers in the government sector was up to 70,000. This drew the need for the meeting held by senior officials in the Interior Ministry with HR professionals from various universities to find an effective way to achieve the 2030 vision.

A detailed report of the progress so far was presented which preceded a lengthy talk on the expected difficulties that the project of Job Nationalization in the government is likely to encounter.

With such detailed planning in place, it is safe to say that for sure, expatriates will not be working for the Saudi Arabian government sectors come 2020.

h/t Saudi Gazette

 

Private Sectors Introduces New Work Schedule in Saudi Arabia: 40 Hours Work Week + 2 Days Off

Employees of the private sector in Saudi Arabia stand a chance to enjoy a two-day weekend and only work 40 hours a week, pending confirmation by King Salman. This is as a result of the vote done by the Shoura Council. For the second time, the Shoura Council has tried to push for these working hours in an effort to amend articles 98,100, 104 of the Saudi Labor Law.

More than 8.4 million members of the Saudi workforce, which includes citizens and expatriates, support this motion. This is because as it stands, the hours they work per week tend to drain them and do not afford them much of a social life. However, as would be expected, most companies, investors, and employers are against it as it robs them some level of profit gained from the extra hours.

The government, last year, shut down this proposal, with the response being that the council should review and reconsider the hours proposed, as well as the two-day weekend idea. As it stands, more than 2 million of the workforce referred to above works in the private sector. Currently, these workers end up working 9 hours per day, though the hours are not meant to surpass 45 hours per week. After this long, tedious week of work, they only get one day off and have to start all over again in the next week. So for almost two years now, the private sector workforce has been waiting for the approval of this proposal to no avail.

This is why the Shoura Council has seen it fit to revive this proposal and see if, this time, they shall not only be heard but be considered and their wishes be granted by the government. Many are hoping that the bill will be accepted and acted upon this time around, and letting the workers avail this privilege.

h/t Emirates 24/7

 

Helpline in Saudi Arabia Dedicated to Serve The Expatriates in the Kingdom

Saudi Arabian expatriates may feel that they have had a rough time finding a way of life here. Well, the government of Saudi Arabia has clearly felt their pain and has introduced a helpline especially set apart for foreigners living in Saudi Arabia. This comes as an answer to the cry of many foreigners who are harassed by their sponsors, employers and even fellow workers who happen to be Saudi citizens.

Many foreign workers in Saudi Arabia complain about the violation of such rights as vacation time, leave or even their salaries being withheld by their employers. Now, these issues can be handled by calling the special number. The officials will either handle the issues with the expatriates’ employers or, if need be, take the matter to the labor court for further action.

So are you a Saudi expatriate in need of help? Call 19911 Saturday to Thursday between 8am to 8pm and get help, free of charge. It is necessary to note, however, that this service is currently available to Urdu, Hindi, Indonesian, English, Arabic, Tagalog and Malayalam speakers only.

 

New Iqama Expat Levy from 2018 to 2020

From January 2018, companies will be expected to pay a new expat levy fee, besides the current dependent fee. This will apply to companies that have an equal or lower amount of expat employees as Saudi citizens as well as companies that have more expatriate employees than Saudi citizens. We break this down year by year:

2018

The current rate that a company that has equal or more foreign employees as Saudi citizens has to pay is SR 2400 per year or SR200 per month. But come January 2018, the rate will go up to SR 3600 per year or SR 300 per month.  The case changes where the expatriates are more than the number of Saudi citizens as then, the company would have to pay a levy fee of SR4800 per year or SR400 per month.

2019

By January 2019, this fee will go up yet another notch higher rising to SR6000 per year or SR 500 per month. This will apply to companies with more or equal number of expatriates in their employ. For those who purely have more expatriates than Saudi citizens, the levy fee charged will be SR 7200 per year or SR 600 per month.

2020

This is where it will get hard, even impossible for a low-income company to hire an expatriate. By this time, companies that have more or equal foreign employees will need to pay a fee of SR 8400 per year or SR 700 per month on each employee. Where the number of foreigners far exceeds that of citizens, the company will be expected to part with a fee of SR 9600 per year or SR 800 per month for each expatriate employee.  Expatriates will clearly need to rethink their work strategies by this time as clearly; companies will be avoiding hiring them.

 

Breaking: Ban on mobile apps is now lifted in Saudi Arabia.

Abdullah Al Sawaha, minister of communications and information technology, announced on Wednesday the lifting of a ban on mobile phone applications effective from coming Wednesday.
Al-Sawaha, who is also chairman of the Communications and Information Technology Commission (CITC), the Kingdom’s telecom regulator, said that coordination between CITC and the telecom service providers is underway to enable customers, including citizens and expatriates, to benefit from applications that provide voice and video calls over the Internet and that will be in compliance with the requirements, the Saudi Press Agency reported.
The minister said that the service providers have confirmed their commitment to enable all customers to use the applications to make voice and video calls of the highest quality and that they will review all applications so as to meet the requirements periodically.
Al-Sawahah thanked the CITC and the telecom companies for developing their technologies in line with the latest trends in the communications and information technology sector and providing the best services for users.
“This fruitful cooperation between the Kingdom’s telecom partners comes under the umbrella of ‘Customer First’, a policy in which everyone works in order to give all telecom subscribers in the Kingdom the best services that meet their expectations and satisfy their needs,” he said.
This step is an extension of previous steps to raise the level of “transparency and clarity” in the sector, including the recent launch of the quarterly index of the classification of telecommunications service providers on the basis of complaints filed by subscribers against service providers, as well as verification of the application of the user protection document and the commitment of service providers to transparency and clarity.
The Kingdom is considered as one of the world’s fastest growing countries in terms of growth in the use of smart phones and participation in social networking platforms. The average use of the Internet by mobile networks in the Kingdom is among the highest globally, which emphasizes the importance of keeping pace with the growing trend in the provision of networks and infrastructure to the highest quality standards.
The ministry is working with the service providers in achieving the goals within the National Transformation Program of 2020 and developing a digital society in line with realizing the goals of the Kingdom’s Vision 2030.
 

9 Insane Penalties for Employers Involved In Violating Labor Laws in Saudi Arabia

The Saudi Arabian government, through the Ministry of Labor and Social Development, has warned companies and employers in general against violating the stipulated Labor Laws.

However, since many companies and employers are still violating these laws, whether knowingly or unknowingly, it has become necessary to list down the most common violations and the penalties that follow. It is paramount that each employer familiarizes with these labor laws so as not to end up on the wrong side of the law.

The Saudi Kingdom is in the process of streamlining the labor market in a bit to strengthen the locals and achieve Saudization.  These include:

  1. If an employer keeps a worker’s passport without their approval, the employer stands to be fined SR 2000. Read: Companies Will be Fined SR2,000 for Keeping Workers’ Passports in Saudi 
  2. An employer will be fined SR5000 if they do not offer a written contract to their employees. This contract should be written in the Arabic language
  3. An employer will abide by the conditions stipulated in the training contract or otherwise stand to be fined SR 5000
  4. Any employer that hires an employee without a written contract or a copy of a written contract will be fined SR 5000
  5. An employer must keep records of their employees including names, fines, salaries as well as medical tests. Failure to this, the employer shall be fined SR 5000
  6. Any employer who withholds full or part of an employee’s salary will be fined SR 5000
  7. If an employer employs a male expatriate as a citizen, they stand to be fined SR 10,000 and the company closed for a day
  8. Employers shall be fined SR 25,000 for hiring expatriates in the capacity of citizens
  9. Employers should not register their employees with GOSI without the employees’ approval. If they do, the employer will be fined SR 25,000 and their company closed for 5 days
 

Shops to close at 9:00PM in the Whole Kingdom of Saudi Arabia

According to a report published by Al-Watan Arabic daily, the proposed government plan to close shops at 9 p.m. will create heavy losses worth SR46 billion for retail businesses across the country. Many people will also lose their jobs due to cut in working hours.

The report, which was prepared by Saudi Fransi Capital, said the 9 p.m. closure would bring down actual shopping hours to four hours from 5 to 9 p.m. In the day time, people will not get much time for shopping because of official and business engagements and hot climate.

“People may also postpone purchases due to short time available for shopping,” the report said, adding that shopping hours of Western countries cannot be applied in countries like Saudi Arabia where people rarely go out for shopping in the day due to extreme hot weather conditions.

Speaking about the merits of 9 p.m. closure, Saudi Fransi Capital said it would encourage Saudis to work at retail shops as it would give them enough time to spend with their families. It will also increase the efficiency of workers as they would get more time to take rest, it added.

At present 1.2 million jobs in the retail sector are occupied by foreign workers who are ready to work 15 hours daily. Saudis, who find it difficult to compete with foreigners, have taken only 300,000 jobs in the sector, which can play a vital role in solving the Kingdom’s unemployment problem.

Fall in electricity consumption is another positive factor as annual commercial energy consumption will be brought down from 48 terawatt hours to 40 or 44 terawatt hours. It will also reduce traffic congestion and bottlenecks after 9 p.m. and cut fuel consumption of vehicles.

The Saudi Fransi Capital report proposed the closure of retail shops after 9 p.m. giving exemption to some essential service providers like pharmacies, restaurants and fuel stations. Exemptions should also be given to the month of Ramadan and the holy cities of Makkah and Madinah, it said.

“The project aims at encouraging Saudis, especially women, to accept jobs at retail shops, helping them to balance between work and family commitments,” the report pointed out.

The move will reduce electricity power consumption of commercial shops, it said adding that the plan would reduce the need for security guards at shopping complexes.

“Early closure of shops will also change Saudis’ consumption style, bringing it closer to international patterns,” the report said.

Total spending of consumers in the Kingdom is estimated at SR416 billion, of which 35 percent or SR146 billion is spent after 9 p.m., the report explained.

About 20 percent of this amount goes to food and drinks, 15 percent to clothing and furniture, 30 percent to restaurants and hotels. The report feared a delay in spending SR20 billion in the retail sector until people change their style of shopping.

“Under the new circumstances, sales worth SR5 billion at retail shops will be affected,” the report said. Big shopping malls would be the biggest beneficiary of the 9 p.m. closure. The change in shopping style will affect electronic and equipment market, Saudi Fransi Capital said in its report.

h/t Saudi Gazette