Arabian Business reported on Wednesday, 6 April 2016 that Saudi Arabia is considering setting up a Saudi Green Card system, similar to that used in the US, as part of plans to raise $100 billion of revenues annually by 2020.
The Green Card system and a plan to charge companies a fee for hiring more foreign workers above official quotas could raise $10 billion each year, Deputy Crown Prince Mohammed bin Salman told Bloomberg. Other than VAT, Prince Mohammed said: “Yes, we have the sin tax, energy drinks and soda drinks tax. We are working on a specific programme similar to the green card. “Some fees might be on luxury items and as we said earlier, restructuring subsidies. So it’s a large package of programmes that aims to restructure some revenue-generating sectors.” The prince said that $10 billion would come from VAT, $30 billion from subsidy reforms and $40 billion from other unspecified measures.
The green card system in the US allows immigrants to live and work in the country permanently. They are valid for 10 years, after which they can be renewed, and are seen as a path to gain citizenship. The employment status of a green card holder. . . [ms-protect-content] has no effect on their ability to stay living in the US.
For the time being further details about the Saudi green card policy are unknown, although more details about Saudi Arabia’s revenue-generating proposals may be clarified in the National Transformation Progamme, which Prince Mohammed said would be launched in less than a month’s time.
Shams Ahsan of the Saudi Gazette dated 7 April 2016 writes that :
Nidal Ridwan, chairman of the Federation of Labor Committees in the Kingdom, told Okaz/Saudi Gazette that he expected the formation of an independent authority to implement the new system.
He said the new authority under the Cabinet would supervise implementation of the system. It will have representatives from the ministries of economy and planning, interior, labor, commerce and industry, and finance, as well as Saudi Arabian Monetary Agency, Saudi Arabian General Investment Authority and General Organization for Social Insurance.
“The new system will bring a lot of economic and social benefits. Non-Saudis will pay what the Saudis pay including Zakat, value added tax and insurance premiums. They will be allowed to own real estate and run trade, industry and service firms,” said Ridwan.
The planned move is part of an ambitious package of reforms to move away from oil based revenue to raise at least an extra $100 billion a year by 2020 and no Gulf Cooperation Council country currently offers a system similar to the green card.