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Labor force hits 2m, domestic helpers 25% of expat workers

Accountants, others to be tested * Govt eyes selective tax * 300K driving licenses face axe

KUWAIT: The latest labor force statistics in Kuwait issued by the Central Statistical Bureau (CSB) as of the end of 2022 indicate that the size of labor force in Kuwait increased by 8.2 percent and reached 2.037 million employees, excluding the number of household workers (1.882 million workers as of the end of 2021). Adding the household labor sector, which is about 753,000 workers, the total reaches 2.79 million workers (2.476 million workers as of the end of 2021).

Household workers constitute nearly 27 percent of total labor force in Kuwait as of the end of 2022 (24 percent of the total labor force as of the end of 2021), according to a report by Al-Shall Consulting, which cautioned that numbers of CSB sometimes differ substantially from those of the Public Authority for Civil Information (PACI). The monthly average wage for male and female Kuwaitis in both the public and private sectors is KD 1,493 (KD 1,491 at the end of 2021) and KD 338 for non-Kuwaitis (KD 338 at the end of 2021).

The figures above do not include household labor, which would have a significant downward impact on the non-Kuwaiti wage rates if taken into consideration, nor do they include the governmental support allocations to Kuwaiti workers in the private sector. Approximately more than a quarter of total expatriate workers in Kuwait are household workers according to the CSB, totaling 753,000 at the end of 2022 (594,000 workers end of 2021), an increase of 26.9 percent. This household labor is divided between 347,000 males and 406,000 females. India has the highest share of household workers of both genders, constituting 44.8 percent of total household workers, followed by the Philippines with 26.6 percent.

Merging the numbers of household workers with other expat categories according to nationalities, Indians make up 835,000 workers (717,000 workers at the end of 2021), or 29.9 percent of the total labor force including Kuwaiti employees and 35.6 percent of the total foreign labor force, taking the lead in both cases. (See Page 2) Meanwhile, the Public Authority of Manpower (PAM) will launch continuous campaigns after the month of Ramadan to check qualifications of residents, which will include financial and technical professions, the first being expats who work in accounting in the private sector, as their numbers have reached more than 16,000.

The campaigns will be conducted by the professional safety center at PAM, which conducted a study of academic qualifications of expats who have job descriptions in the field of financial and technical work as part of the government’s steps to correct the population structure. The move follows the vocational tests that PAM announced will be part of the process of bringing in new workers into the country and testing old workers, and work permits will not be issued without passing the tests.

These steps come following a previous decision by PAM to issue a smart ID through the Kuwait Mobile ID app to enable Kuwait families to check laborers’ data before allowing them to carry out any work, in order to stop loose laborers and commercial cheating. PAM has set up the Kuwait Visa application to verify visas issued to workers coming to Kuwait and others who have business and tourist visas issued through the electronic platform that cannot be transferred to work permits.

Local media has quoted sources as saying the interior minister has formed a committee to study the status of expatriate driving licenses and review all their data, revealing the ministry will put a “block” on the license of any expatriate who does not hold a university degree and their salary is less than KD 600, leading to the withdrawal of the license. Sources said that this decision will affect around 300,000 licenses, noting when the decision enters force, it will be applied immediately and retroactively.

Separately, senior government sources said executive procedures to impose selective tax instead of the value added tax are ready at the finance ministry to become the government’s first choice to collect taxes, adding the government has excluded the option of imposing VAT. Sources said the application of VAT needs the approval of the National Assembly, which is difficult to get, as there is a popular rejection of VAT, and this reflects on MPs’ opinions, who will not vote in favor of the tax. The sources said VAT was excluded as a first choice due to increasing fear of inflation, which is registering historic levels in major industrial countries, and its effects are reverberating in Kuwait and the region.

They said going ahead with such a tax at this time will cause a sharp increase in prices, and the consumer will not be able to bear its burdens. The sources said imposing the selective tax will include tobacco and its derivatives and carbonated drinks, in addition to highly expensive goods such as watches, jewelry, precious stones, luxury cars and yachts, bearing in mind the value of the proposed tax is between 10 percent to 25 percent. Sources said applying the selective tax will bring in KD 500 million yearly and will not affect limited- and middle-income people, as it targets accessories and luxury goods.

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