NOB | Bahrain                                                      

The Daily Tribune – www.newsofbahrain.com

The Bahrain Shura Council rejected a draft law imposing a tax on foreign remittances. Last week, a proposal to impose a two percent tax on all foreign cash transfers made from Bahrain was drafted and presented in Parliament. However, today MP Bassam Al-Bin Muhammad, a member of the Shura Council's Financial and Economic Affairs Committee, pointed out several negative effects of such a law on economic, financial, and social levels.
He pointed out that the draft law will reduce legitimate foreign transfers and encourage individuals to use alternative methods to send money abroad, potentially leading to money laundering, a black market, or the use of cryptocurrencies.
This could negatively impact Bahrain's reputation as an advanced country in the banking and financial sector, as it may turn to illegal means to avoid paying taxes on these transfers.
He further explained that it conflicts with several of Bahrain's approved agreements and treaties, such as international and bilateral tax treaties, as well as agreements to attract and safeguard investment. It will also impact Bahrain's competitiveness in attracting foreign investment, which generates job opportunities for residents and boosts economic growth. It may also hinder investment and capital mobility.
He further pointed out that the draft law does not establish the penalties for violating the law if it is approved.