The proposal for a two percent levy on the billions of rials that expatriates send home every year has been approved by Oman’s Majlis al-Shura, or the lower house of the council of Oman, to overcome a budget deficit due to drop in oil prices, a media report said.

“The approval to tax expatriate remittances is one of the several steps proposed to overcome the budget deficit, which the Sultanate will face while adjusting the oil price,” Times of Oman quoted Tawfiq Al Lawati, a Shura member, as saying.

The move would hit 1.9 million expats, the report said, adding that it may drive an increase in black market money transfers.

There are around 600,000 Indians working in Oman.

“Every country has right to mobilise income for its development. We cannot say no to their plans. As majority of the expat workers belong to the low-income group, they should be exempted from tax,” Umesh Kumar, chairman of the Institute of Chartered Accountants of India’s Muscat Chapter, said.