COMMERCIAL NEWS
Saudi Arabia expects $9bn VAT revenue in first year
Jan 2, 2018 7:08 AM
Saudi Arabia is expecting a total of SR35 billion ( 9.3 billion) in revenue during the first year of applying the value-added tax (VAT) the project manager of VAT at General Authority of Zakat and Tax...
Saudi Arabia is expecting a total of SR35 billion ($9.3 billion) in revenue during the first year of applying the value-added tax (VAT), the project manager of VAT at General Authority of Zakat and Tax (GAZT) was quoted as saying in a media report.
Hamoud Al-Harbi affirmed the punitive measures to be adopted strictly for those who have not registered so far, or who violate the laws, reported Emirates news agency Wam.
The Ministry of Commerce and Investment has announced that in cooperation with the General Authority for Zakat and Tax it will intensify inspection tours in markets and commercial firms across the Kingdom to track down irregularities during application of the VAT.
Saudi Arabia started on Monday applying the value-added tax as part of the country's plans to boost revenue. The 5 per cent tax will apply to a wide range of items, including food; clothes; electronics; petrol; phone, water and electricity bills; and hotel reservations.
The tax is imposed by Saudi Arabia within the framework of a unified agreement endorsed by the member states of the Gulf Cooperation Council (GCC). Saudi Arabia has already imposed the excise tax at 100 per cent on tobacco products and energy drinks, and 50 per cent on soft drinks.
The imposition of VAT will help to raise tax revenues of the Saudi government to be utilised for infrastructure and developmental works, Al-Harbi added, noting that VAT will contribute to address challenges and sustain growth.
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