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Bahrain has halved the fees for foreign workers, giving a massive boost to small and medium enterprises, according to the Labour Market Regulatory Authority (LMRA). The proposal to reduce the BHD 10 (USD19.78) levy on businesses was approved by the Cabinet, reported the Gulf Daily News.
It agreed to cut the monthly fee per expatriate to BHD5 (USD 9.89) for companies who employ fewer than five workers.
Sameera Rajab, Minister of State for Information Affairs and government spokeswoman, commented: "Small business entities currently constitute 78 per cent of the total number of businesses operating in Bahrain that employ less than five employees and they will benefit from this reduction. This is now a new decision that is approved and waiting to be implemented."
Speaking during the weekly Cabinet press conference held at the Gudaibiya Palace, Ms Rajab said a proposal was presented by Finance Minister Shaikh Ahmed bin Mohammed Al Khalifa regarding the LMRA fees.
Companies are supposed to pay the monthly levy for each expatriate they employ, but the tax has been waived since April 2011 to offset the financial impact on the private sector. The government initially suspended the fee for six months, but later extended the grace period for up to a year to help revive the economy. The government wanted to reintroduce the charge, but traders demanded its extension saying it would negatively affect business as some were still struggling to stay afloat.