Remittance Tax in Kuwait, A First in the GCC

April 10, 2018 Taxation in Kuwait

remittance tax in kuwaitDOHA – Foreigners working in Kuwait will have a harder time if they plan on sending money home.

Earlier this month the Parliamentary Financial and Economic Affairs Committee of Kuwait announced that it has approved a bill which would impose a tax on overseas remittance sent by expats in the country.

The new tax is intended to be tiered, in order to lessen the impact on low-income earners.

The rate of tax applied to remittance of between KWD 1 and KWD 99 is only 1 percent, while the rate of transfers of between KWD 100 and KWD 200 are set at 2 percent, 3 percent for transfers of up to KWD 499, and 5 percent on all further transfers.

The government expects that if the tax is enacted, it could lead to tax revenues f as much as KWD 70 million.

The current level of remittance in Kuwait is estimated to reach KWD 19 billion per year.

Approximately 27 percent of all transfers out of Kuwait currently flow to India, while 18 percent end up in Egypt, followed by Bangladesh at 7 percent, and Philippines and Pakistan at 3 percent each.