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.


Riyadh governor launches SR3 billion educational projects in Saudi capital

Updated 19 min 21 sec ago
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Riyadh governor launches SR3 billion educational projects in Saudi capital

  • 253 schools will open their doors to students: governor
  • The school buildings would serve 206,465 male and female students at all stages of schooling with 5,899 classrooms

RIYADH: Riyadh Gov. Prince Faisal bin Bandar launched SR3 billion ($800 million) worth of educational projects on Wednesday at the Riyadh General Administration of Education. 

The launch was in the presence of Education Minister Ahmed Al-Issa and a number of educational and pedagogical leaders as well as governmental bodies.

Prince Faisal said: “Today, we are seeing the cancelation of many old schools and the enhancement of many new ones; 253 schools will open their doors to students, a very high number that is not very common in many other states.”

The director general of education in Riyadh, Hamad bin Nasser Al-Wahaibi, said the educational projects aimed to achieve the Kingdom’s Vision 2030, which includes providing an adequate educational environment for students and teachers.

He said that the number of educational projects launched on Wednesday by Prince Faisal totaled 253 educational buildings, including 132 for boys and 121 for girls, along with 122 modern gyms, 44 playing fields, and 28 kindergartens and educational offices. He said that the school buildings would serve 206,465 male and female students at all stages of schooling with 5,899 classrooms. 

The total worth of these projects was SR3 billion ($800 million) and the current school year had seen the operation of 48 educational projects worth more than SR572 million.

These projects included four kindergartens, 12 primary schools, 11 educational projects for middle school, five for high school and 13 educational complexes and gyms. 

This year, seven kindergarten buildings, 22 primary schools, 15 middle schools, nine high school buildings and 20 gyms were operated, along with 31 buildings for boys (including 757 classrooms for 22,000 students) and 33 buildings for girls (including 404 classrooms for 12,000 female students), he said.

He said that the Riyadh administration supervised 119 educational projects worth more than SR1.2 billion.