# Expats would be hit by remittances tax



## NewAndConfused (Jul 22, 2013)

Hi, 

I am sure you have heard about this !! what do you think ?? 


S


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## saraswat (Apr 28, 2012)

Expats would be hit by remittances tax: Dubai boss - Politics & Economics - ArabianBusiness.com_

“This has really addressed a lot of workers... here who contribute minimally to the economy... this is one way to try to address this issue because all of their funds are [being sent as] remittances." ...
"__As much as 90 percent of the UAE population of 8m is made up of expats, particularly labourers from poorer countries in southern Asia and Africa."...

_Right so rather than bring a little semblance of modernity and equality to the employment market, thereby making a person's qualifications and accomplishments and not his/her passport, one of the primary characteristics upon which pay-scale, job-level, benefits etc etc.. are determined. The idea is to go ahead and think about implementing a tax on remittances.... Let's not talk about maybe bringing better wages into play in the construction market, along with better work conditions. Those surely wouldn't work towards having a person spend in the local economy... 

How exactly is a worker getting paid 700 - 1000 AED a month take home going to afford anything in the U.A.E, that would make his/her contribution meaningful to the local economy, regardless of a tax on remittances or not ? 

Yeah well, if this does happen and people thought the 2008 crises was bad, they are in for a real rude awakening ...


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## Peterf (Jan 9, 2012)

saraswat said:


> Expats would be hit by remittances tax: Dubai boss - Politics & Economics - ArabianBusiness.com “This has really addressed a lot of workers... here who contribute minimally to the economy... this is one way to try to address this issue because all of their funds are [being sent as] remittances." ... "As much as 90 percent of the UAE population of 8m is made up of expats, particularly labourers from poorer countries in southern Asia and Africa."... Right so rather than bring a little semblance of modernity and equality to the employment market, thereby making a person's qualifications and accomplishments and not his/her passport, one of the primary characteristics upon which pay-scale, job-level, benefits etc etc.. are determined. The idea is to go ahead and think about implementing a tax on remittances.... Let's not talk about maybe bringing better wages into play in the construction market, along with better work conditions. Those surely wouldn't work towards having a person spend in the local economy... How exactly is a worker getting paid 700 - 1000 AED a month take home going to afford anything in the U.A.E, that would make his/her contribution meaningful to the local economy, regardless of a tax on remittances or not ? Yeah well, if this does happen and people thought the 2008 crises was bad, they are in for a real rude awakening ...


Agreed. The only reason to be here is the tax-free income. The day that looks like stopping, it's off to the airport for me. 

I have had discussions with other expats working for companies in Dubai. The consensus is that Dubai is already becoming too expensive to operate from (when incorporating the rent increases etc) and there are already other very attractive countries to move with similar tax free status. Something like this will the the catalyst for change. 

Unfortunately there are millions of workers here who can't make the same choices I can - those are the ones I feel really sorry for.


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## vantage (May 10, 2012)

it's totally unenforceable.

if it's Dubai only, head to Abu Dhabi or Sharjah and do it.
Apparently it is not on the radar of Central Government (yet)

failing that, take cash home once or twice a year.


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## Peterf (Jan 9, 2012)

vantage said:


> it's totally unenforceable. if it's Dubai only, head to Abu Dhabi or Sharjah and do it. Apparently it is not on the radar of Central Government (yet) failing that, take cash home once or twice a year.


It will easily be enforceable as they'll have the banks/foreign transfer houses withhold a percentage of any transaction. 

I would imagine they'll make it UAE-wide, I don't think they're that short-sighted. 

There is a limit on the amount of cash you can carry into/out of a country & I don't fancy an 18 hour trip (each way) every time I want to send cash home.


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## saraswat (Apr 28, 2012)

This is pure speculation, and the measure might have been on the table before, but I suspect the recent significant devaluation of the Indian Rupee, and the amounts of money sent back home to take advantage of that opportunity has maybe got this gain more momentum ...

By the way, it did get ridiculous, I personally know of two people that took rather large personal loans just to send money back home, if it works out like they planned, a straibght 25 - 30% gain after interest ....


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## Stevesolar (Dec 21, 2012)

The thing is - we are already paying "tax" to work here anyway.
Some examples:-
Salik - 4AED per trip - I am spending at least 250AED per month on this.
Car parking - 750AED every three months for parking card.
NOL for Metro/Buses etc. - 250 AED per year.
Taxi fares - 200 AED per month.
Driving licence - 410 AED for new licence
Visa fees - around 600AED for medical once I got job and transferred off my wife's visa.
Etisalat mobile - 250 AED per month
DEWA - 2000 AED per month
The list goes on - remember all the above are governmental or semi-governmental companies - so all the money goes back into Dubai/UAE coffers.
Money in Dubai seems to go around in a big circle and ends up with the government here.
Not complaining per se - just pointing out the facts!!
Cheers
Steve


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## Jumeirah Jim (Jan 24, 2011)

It's an idea by Dubai to tax the poorest of the poor 

Absolutely, completely shameful

what ExecExpat said on ArabianBusiness sums up some brainless expats attitudes' to this and is disgraceful 

thankfully the federal government will never in a million years let this get through. it makes no sense for Abu Dhabi for starters.


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## mehranR (Jul 27, 2013)

And I am planning to come to Dubai, in order to avoid paying high US taxes.


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## fcjb1970 (Apr 30, 2010)

Stevesolar said:


> The thing is - we are already paying "tax" to work here anyway.
> Some examples:-
> Salik - 4AED per trip - I am spending at least 250AED per month on this.
> Car parking - 750AED every three months for parking card.
> ...



I agree there are many fees and costs n this country that could easily be classified as taxes, your list, though, is a bit nonsensical. 

In what major city would you not pay for parking, taxi, public transport. These you somehow expect to be free because there is not income tax? Toll roads also pretty common (although that is certainly more tax-like than the previous items).

Mobile phone...more expensive here than many places, but still something you always pay for. Same could be said about drivers license. 

The one item on you list I would say is a true tax is the 5% DEWA charge, which can not be classified as anything other than a tax. Things like medical and EID charges certainly fall into a similar category, but should be covered by employer, never heard of anyone paying out of pocket. I would more consider the simple costs of goods to be close to being a tax. When it is less expensive to have something shipped from the US, obviously the money I saved on sales tax does not have much impact


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## ReggieDXB007 (Mar 10, 2011)

fcjb1970 said:


> The one item on you list I would say is a true tax is the 5% DEWA charge, which can not be classified as anything other than a tax. impact


If you mean the housing fee, I would argue that it is not a tax, at least not on income but a levy to defray municipality costs, such as the street lights, garbage disposal, cleaning, landscaping etc. When you compare it to something like rates in the UK, it is not too unreasonable although setting a equitable system is almost impossible as the Poll Tax riots proved.

Where it is ridiculous of course is within gated communities where DM does not provide services so one pays community fees to the master developer on top of the housing fee. Another reason to avoid those open prisons. (Sorry I just hate having to go through security every time)


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## Stevesolar (Dec 21, 2012)

fcjb1970 said:


> I agree there are many fees and costs n this country that could easily be classified as taxes, your list, though, is a bit nonsensical.
> 
> In what major city would you not pay for parking, taxi, public transport. These you somehow expect to be free because there is not income tax? t


The point i was trying to make was the comparison between western developed nations and here regarding privatised utilities and industries.
In UK for instance electricity, mobile phones, taxis and buses are all run by private companies whose main interest is earning money for shareholders and who operate in a competitive environment that helps consumers. The UK government then earns tax revenue (if they actually pay any corporate tax!!)
Here, the difference is that the above are all government owned - so the revenue goes in that direction rather than to private shareholders. As the revenue goes to government it is therefore like a "tax" (especially as you are dealing with a monopoly and have no choice of service provider).
I have never personally paid parking to go to work in any other country i have lived in - Dubai is a first for me, as i work in an office block without general free parking.

Cheers
Steve


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## Tropicana (Apr 29, 2010)

fcjb1970 said:


> I agree there are many fees and costs n this country that could easily be classified as taxes, your list, though, is a bit nonsensical.
> 
> In what major city would you not pay for parking, taxi, public transport.


Taxis are very expensive when the average salary (of office workers, not laborers) is taken into account.

Parking is cheap, but keep in mind that in parts of Abu Dhabi, people pay to park in front of their own homes 

Accomodation and education; these 2 items are not taxes, but for people not getting separate allowances they comprise a far larger chunk of income than in many places (anything from 30-70%)


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## Guest (Oct 8, 2013)

Stevesolar said:


> The thing is - we are already paying "tax" to work here anyway.
> Some examples:-
> Salik - 4AED per trip - I am spending at least 250AED per month on this.
> Car parking - 750AED every three months for parking card.
> ...


So you don't pay any of these, in a tax-paying country? 

Edit: Sorry already been asked-answered, noticed it after I posted...


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## Zexotic (Sep 3, 2011)

Stevesolar said:


> The thing is - we are already paying "tax" to work here anyway.
> Some examples:-
> Salik - 4AED per trip - I am spending at least 250AED per month on this.
> Car parking - 750AED every three months for parking card.
> ...



You forgot to add food, rent and entertainment to the list.


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## ReggieDXB007 (Mar 10, 2011)

Stevesolar said:


> In UK for instance electricity, mobile phones, taxis and buses ...
> ...I have never personally paid parking to go to work in any other country i have lived in - Dubai is a first for me, as i work in an office block without general free parking.


I must be very old as I well remember the days of Royal mail/British telecom, British gas, London Electricity Board, British Rail, Thames Water, all public sector companies

As for parking - you are obviously not a London lad. I remember the day I started commuting by public transport was when the parking meters in St. James' square were upped to 1 pound an hour (probably a lot more these days). 

Which brings an interesting point - we were running financial projections for a real estate development here in Dubai back in 2003 and a US colleague remarked with some surprise that we didn't factor in parking revenues. "No Emirati or expat will pay for parking said I." Famous last words!


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## Stevesolar (Dec 21, 2012)

ReggieDXB007 said:


> I must be very old as I well remember the days of Royal mail/British telecom, British gas, London Electricity Board, British Rail, Thames Water, all public sector companies
> 
> As for parking - you are obviously not a London lad. I remember the day I started commuting by public transport was when the parking meters in St. James' square were upped to 1 pound an hour (probably a lot more these days).
> 
> Which brings an interesting point - we were running financial projections for a real estate development here in Dubai back in 2003 and a US colleague remarked with some surprise that we didn't factor in parking revenues. "No Emirati or expat will pay for parking said I." Famous last words!


I certainly remember those companies - i worked as a chemist for Thames Water before i moved to Saudi Arabia.
I am not from London (Guildford - much posher!!!) - but worked in shepherds bush for a few years - luckily we had our own free parking.
Cheers
Steve


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