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 and UAE to donate $70 million to support Yemeni teachers

Al-Rabeeah said the Houthis are to blame for the deterioration of the humanitarian and economic situation in Yemen. (AFP)
Updated 23 October 2018
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Saudi Arabia and UAE to donate $70 million to support Yemeni teachers

  • The Saudi-led coalition stresses the need for concerted international efforts to support the humanitarian and economic situation in Yemen and avoid further deterioration: Al-Rabeeah
  • The coalition countries are expecting the new Yemeni government to prioritize economic and humanitarian matters: KSRelief chief

Dr. Abdullah Al-Rabeeah, general supervisor of the King Salman Humanitarian Aid and Relief Center (KSRelief) and adviser to the Royal Court, announced on Monday that Saudi Arabia and the United Arab Emirates will each donate $35 million to pay teachers in Yemen, in cooperation with the United Nations and UNICEF.
He said that the contributions reflect the concern of the Saudi-led coalition countries about the situation in the country and their desire to alleviate the suffering of the Yemeni people, who have been suffering economic hardship. Many Yemenis, and teachers in particular have not been paid for some time. The donations, with the assistance of UNICEF, will help provide salaries for 135,000 teachers.
Al-Rabeeah added that since 2015, coalition countries have donated $17 billion dollars to help the people of Yemen get through the humanitarian and economic crisis in their country.
“The Saudi-led coalition stresses the need for concerted international efforts to support the humanitarian and economic situation in Yemen and avoid further deterioration,” he said.
“The coalition countries are expecting the new Yemeni government to prioritize economic and humanitarian matters and activate an action plan facilitating the process. The new government should work on enhancing its performance, in accordance with the international efforts to support the people and their living conditions, in order to prevent the deterioration of the humanitarian situation in Yemen, especially in terms of food security and public health.”
Al-Rabeeah said the coalition countries lay the blame for the deterioration of the humanitarian and economic situation in Yemen with the Houthi militias and their coup against the legitimate authorities in the country and their rejection of a political solution, as well as their non-compliance with the international resolutions.