Saudi Arabia’s VAT implementing regulations defined

Among transactions exempted from Saudi Arabia’s Value Added Tax include loans, credit cards, mortgages and deposits and savings accounts. (Reuters)
Updated 10 November 2017
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Saudi Arabia’s VAT implementing regulations defined

RIYADH: The implementing regulations of the Value Added Tax (VAT) system has defined exempted activities in the financial sector that include many types of transactions and services, such as interest on loans or lending fees charged with an implicit profit margin.
These exempted activities include loans, credit cards, mortgages, finance leases, banknotes or securities transactions, current accounts, deposits and savings accounts. The transfer of funds from the tax has also been exempted and charged to the transfer fees.
As for the transfer of funds, the executive regulation demonstrated, as quoted by Al-Hayat newspaper, that the amount transferred is not subject to VAT, but is charged with a transfer fee of 5 percent and paid by the person who transfers the money.
The regulation specifies taxable cases of 5 percent, subject to tax at zero rated, exempt or outside the scope of the tax.
Entities engaged in economic activity subject to tax shall be entitled to recover the amount of the VAT they paid on their taxable inputs, which are related only to taxable activities by 5 percent or zero rated. Enterprises engaged in exempt economic activities are not entitled to recover the amount of VAT they have paid on their taxable inputs.
The VAT will be applied in the Kingdom on January 1, 2018 as part of the Unified Agreement for VAT in the GCC Region.
The General Authority of Zakat and Tax has invited all entities to register in the VAT through the VAT.GOV.SA website. This website provides a wide range of tools and information that is a reference to support these enterprises to ensure their readiness, along with visual aids, all the information, and general and technical FAQs that include aspects of the registration process and the willingness to apply the tax.


‘Saudi Arabia is symbol of humanitarian action in world’

Updated 12 min 19 sec ago
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‘Saudi Arabia is symbol of humanitarian action in world’

JEDDAH: Dr. Abdullah Al-Rabeeah, general supervisor of the King Salman Humanitarian Aid and Relief Center (KSRelief) said that Saudi Arabia is a symbol of humanitarian action in the world and a shining example in providing assistance to needy countries and supporting the affected peoples throughout its glorious history.
He said that, since 2007, the total Saudi financial contributions to international organizations and bodies amounted to $1.9 billion, while the total humanitarian, development and charitable projects amounted to $33 billion, and the total assistance provided by the Kingdom was worth $35 billion.
Al-Rabeeah said that the Kingdom’s humanitarian, development and charitable assistance had helped nations such as Afghanistan, Jordan, Sudan, Somalia, Iraq, Morocco, Niger, Yemen, Indonesia, Pakistan, Bangladesh, Burkina Faso, Tanzania among others.