The Ministry of Labor announced yesterday it plans to not impose the new expat fee on small businesses in the Kingdom.
A ministry spokesperson told Al-Sharq the new monthly expat fee of SR 200 would not apply to businesses employing less than 30 workers, even if the number of Saudi workers are less than 50 percent of the total number employed.
He said the ministry was monitoring protest gatherings by citizens in a number of regions around the Kingdom.
The decision came after mounting pressure from business owners who took their concerns to local Chamber of Commerce groups and Ministry of Labor offices.
On Monday, small business traders from Buraidah in Qassim province gathered to protest the fee at the Ministry of Labor office in the city. They accused the ministry of being unfair and said they would not comply with the order.
Qassim police sought the help of the special task force to control the traders who protested in front of the labor office. Director of Qassim Police, Maj. Gen. Badar Al-Tayyib, dispersed the protesters peacefully. On the same day in Taif, more than 50 businessmen gathered in front of the local labor office. They met with a ministry representative and demanded the cancelation of the ministry’s expatriate fee. Ali Al-Shamrani, director of the ministry office, said he listened to the traders’ concerns and forwarded them to the ministry.
The protests have raised a debate in favor of the expatriate fee.
Shoura Council Member Saud Al-Shamri, and member of the council’s Islamic and Legal Affairs Committee, said he could not understand why business owners are in uproar over the Ministry of Labor’s decision to impose the expatriate fee, when the proceeds will fund training and employment programs for Saudi youth.
“Some Saudi businessmen’s efforts to foil the ministry’s move is unreasonable, particularly when the Council of Ministers made this decision more than a year ago,” Al-Shamri said. “These business owners had ample time in the last year to discuss their concerns with the ministry.”
He demanded that business owners be ready to make sacrifices for the welfare of society and not pass the burden of the new fee onto the consumer.
Abdul Kareem Al-Anazi, director of human resources at a private company, criticized business owner’s stand against the new fees. He also wondered why they did not voice their concerns in the 14 months after the decision was made.
He said he believes they plan to put a stop to the ministry’s decision to attract more Saudi employees to the private sector, especially when the minimum salary for a Saudi starts at SR 3,000 a month.
Nasser Al-Towaim, chairman of the Consumer Protection Society, said the Labor Ministry’s decision to charge a fee for expatriate workers would be exploited by greedy businessmen and give them an opportunity to increase their prices.
He warned the Ministry of Labor’s offer to compensate businesses that experience loss as a result of the decision, might lead to corruption and false reporting of employee ratios and ultimately shift the burden to the consumer. He said small and medium-sized entrepreneurs would be the first casualties of the new fee, despite the fact the state strives to make these same entrepreneurs major contributors to the domestic economy.
He urged the ministry to amend its decision and study the impact the new fee would have on business in the Kingdom.