Saudi Arabia steps into a new era with VAT

The inspection tours will be directly supervised by the joint operation room for protection of consumers. (SPA)
Updated 01 January 2018
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Saudi Arabia steps into a new era with VAT

RIYADH: It is hoped that the levying of a value-added tax (VAT) from Monday will power the Kingdom’s march toward progress and prosperity.
The tax is imposed by Saudi Arabia and the UAE within the framework of a unified agreement endorsed by the member states of the Gulf Cooperation Council (GCC).
“The imposition of VAT will help to raise tax revenues of the Saudi government to be utilized for infrastructure and developmental works,” said Mohammed Al-Khunaizi, a member of the Shoura Council, here on Sunday, while calling VAT “a major move that will contribute to address challenges and sustain growth.” While referring to the compliance of Saudi businesses with VAT regulations, he pointed out that VAT or sales taxes are key revenue sources for more than 166 countries across the world today.
Al-Khunaizi also called for “punitive measures” to be adopted strictly for those who have not registered so far, or who violate the laws. The Ministry of Commerce and Investment has announced that in cooperation with the General Authority for Zakat and Tax (GAZT), it will intensify inspection tours in markets and commercial firms across the Kingdom to track down irregularities before
and during application of the VAT.
“The inspection tours will be directly supervised by the joint operation room for protection of consumers, which was approved by the Council of Ministers and composed of 18 government agencies,” said a ministry statement.
Asked about the preparedness of the retail sector in general, Shehim Mohammed, director of operations of a leading chain of supermarkets in Saudi Arabia, said that the retail outlets have “geared themselves well to comply with VAT regulations…”
Asked about the plan to educate customers at stores about VAT, he pointed out that bills will display VAT charges at their stores. Moreover, VAT will be a great revenue stream for the government, and it will streamline product flow in a positive manner, he observed. “It will tweak customer buying habits pragmatically, though it will force the market movement in the right direction.”
On the introduction of the VAT, Vikas Panchal, a business executive, said: “VAT is a significant milestone in the history of the GCC and is all set to be a major boost for the economy... We understand that the change will be challenging to begin with, more specifically for businesses.”


New technologies help increase number of flights, passengers in Saudi Arabia’s airports — GACA

Updated 39 min 20 sec ago
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New technologies help increase number of flights, passengers in Saudi Arabia’s airports — GACA

  • More than 99.86 million passengers departed or arrived through 771,828 flights in the Kingdom's international and domestic airports in 2018
  • GACA is due to host Global Aviation Summit 2019 on April 1 and 2 in Riyadh

JEDDAH: New technologies applied in Saudi Arabia's airports has contributed to aviation growth in the Kingdom and has provided solutions for passenger’s trips, air cargo and investments, the General Authority of Civil Aviation (GACA) has said.

GACA earlier reported an 8 percent increase in passenger numbers and 4 percent in flight rates in 2018.

It said more than 99.86 million passengers departed or arrived through 771,828 flights in the Kingdom's international and domestic airports in 2018, compared to 92.42 million passengers on board 741,293 flights in 2017.

"The GACA is keen to adopt plans to develop the Kingdom's airports network in order to keep pace with the steady increase in air traffic, increase the reliability of services, maximize geographic coverage and enhance the contribution of the airports to the overall economic growth of the country," it said.

For example, it said, GACA provides information through technology to reduce paperwork, operating costs and streamline business processes while reducing time to address them.

Most prominent among these e-services is the “Self-Services at the Kingdom's airports” that include check-in kiosks that provide boarding passes and luggage identification cards and self-service baggage drops that allows passengers to self-check their luggage.

It also provides self-scanning devices for bags in the arrival halls, ensuring that all baggage and other cargo arrive at the airport through the installation of electronic gates for the passage of freight vehicles before being emptied into the luggage compartment. 

Electronic gates and document scanning machines ensure that a traveler's information is correct and that boarding passes, passports, national identity and residency are valid.

Other services include airport operations systems and flight information display for some domestic airports.

To ensure accuracy in the flight schedules, GACA said it is working on a project to link the Saudi Arabian Airlines traffic management system to the Airport Management System, of which 50 percent has been completed.

GACA is due to host Global Aviation Summit 2019 on April 1 and 2 in Riyadh to review the infrastructure projects for airports and smart airports, the available opportunities to operate the airports and provide advanced services and consultations in civil aviation, among others.