A number of Indians employed in Saudi Arabia are planning to send their dependants back home as the kingdom is set to introduce, from 1 July, a monthly 'dependant fee' for expats.
The fee of 100 riyals (Rs1,700) per month for each dependent is likely to prove a financial burden for the Indian expats.
The nearly 41 lakh Indian population in Saudi Arabia is bracing for the `dependent fee'. Indians are the largest expat group in Saudi Arabia and southern Indians form a bulk of this, with at least 10 lakh Telugus from Andhra Pradesh and Telangana employed there.
Expat levy is seen to boost kingdom's revenues amid low oil prices. However, according to Gulf News, reforms such as the levy on foreign workers may help augment government revenues, but they can increase the cost of doing business in the kingdom.
"Some families who I know have made plans to return to Hyderabad as they feel they cannot afford to stay there any longer," Mohd Taher, a computer professional from Musheerabad, Hyderabad, who lives in Dammam, told The Times of India.
Migrant rights activist Bheem Reddy Mandha said that several Telugus had already sent their families back to India in the past four months. "The men have become `forced bachelors'," he said.
Saudi Arabia gives a family visa to anyone with a salary of 5,000 riyals per month. So, an Indian expat with dependent wife and two children will have to pay a total of 300 riyals (5,400) a month. Moreover, this tax is set to go up by 100 riyals per dependent every year till 2020. That means by 2020 a family would have to shell out 400 Saudi Riyals for each dependent every month. Moreover, this fee has to be paid in advance.
For instance if a man's dependent wife is to stay in Saudi Arabia for one year, a total of 1,200 riyals has to be paid in advance at the time of renewal of the Iqama (residence permit). So, for a family of three dependents (wife and two children), the employee will pay the advance tax of 3,600 riyals or 64,800 per year.
Apart from this tax, life in Saudi Arabia is set to get tougher. From 1 July, prices of beverages will go up by 100 per cent and tobacco products will also become costlier.
With workers having been laid off in Saudi Arabia because of the fall in crude oil prices, thousands of Indian workers have had to return with continuing uncertainly. Indians employed in construction, IT, medical infrastructure and other sectors are believed to be rethinking their plans on staying back in Saudi Arabia.
While some companies are reportedly planning to compensate their employees for the ''dependent fee'', most have no option but pay it themselves.
Asked what effect the 'dependent fee' would have on Indian expats in Saudi Arabia, a senior official in the ministry of external affairs (MEA) told TOI nothing could be said as yet. "But it will affect all expats," the MEA official said.