On the taxing of migrants’ earnings while retaining a migrant workforce

Oded Stark, Wiktor Budzinski

Research output: Contribution to journalArticlepeer-review

Abstract

We study policies that are aimed at retaining a migrant workforce in a Gulf State while introducing a tax on migrant earnings. We single out Qatar as a case study. We consider two types of migrants: target migrants, and non-target migrants. If migrants are target migrants, we show that in order to neutralize the effect of a tax on their earnings, Qatar needs to extend the length of time migrants are allowed to stay. Such a scheme can work even when the migrants experience utility loss from staying longer in Qatar. If migrants are non-target migrants, we show that implementation of a lottery scheme in which the prizes are life-long residency in Qatar can “compensate” for the imposition of the tax. In both cases, we present numerical examples that illustrate the magnitudes involved.

Original languageEnglish
Pages (from-to)151-155
Number of pages5
JournalInternational Review of Economics and Finance
Volume57
DOIs
StatePublished - Sep 2018
Externally publishedYes

Keywords

  • Migration
  • Non-target migrants
  • Target migrants
  • Taxing migrants

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