Malay levy rise affects NepalisMalaysia’s decision to increase levy rate for foreign workers will add extra financial burden on Nepali workers—increasing the cost of being employed in Malaysia.
Malaysia’s decision to increase levy rate for foreign workers will add extra financial burden on Nepali workers—increasing the cost of being employed in Malaysia.
As per the regulation that came into effect on Monday, an annual levy of RM2,500 will be imposed on the salary of foreigners working in manufacturing, service, security and other organised sectors. Foreigners working in plantations and agriculture will have to pay RM1,500.
Earlier, the Malaysian government was charging up to RM1,250 annually in levy on migrant workers depending on the nature of their jobs.
The move has come as a big disappointment to around 700,000 Nepali workers who have been grappling with weak ringgit, low pay and heavy recruitment cost. Around 75 percent of Nepali workers earn just RM900 a month, according to the Nepali embassy in Malaysia.
“Workers are already finding it hard to go to Malaysia due to weak ringgit, high recruitment cost and low pay compared to Gulf countries. It would be hard to send workers now,” said Kumud Khanal, a representative of the Nepal Association of Foreign Employment Agencies.
Nepali workers are paying as much as Rs150,000 to go to Malaysia despite the free-visa-fee-ticket scheme. In most cases, workers have to work around a year to recuperate the money they spent for going to Malaysia.
Recruiting agencies blame Malaysian government’s high visa processing fee and other associated expenses for the higher recruitment cost. Malaysia has a mandatory health check-up and pre-departure training for workers through selected agents in Nepal who charge unusually higher fee.
Former foreign minister Narayan Kaji Shrestha said that Nepal should temporarily stop sending workers to Malaysia as they have become subject to economic and physical exploitation. “Nepali migrants are facing widespread abuse and exploitation. It would be wise to stop migrants from going there for some time and ensure proper mechanism to ensure their rights and safety,” Shrestha told the Post in a recent interview.
Myanmar has stopped sending its citizens to Malaysia for work, while other countries including Indonesia have threatened to follow suit.