Saudi Arabia steps into a new era with VAT
Saudi Arabia steps into a new era with VAT
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.”
Saudi Arabia downs Houthi missile fired across border
- The missile was launched from Saada, the Houthi stronghold in northern Yemen
- Saudi forces said they intercepted a Houthi ballistic missile targeting the Kingdom’s southern coastal city of Jizan on Friday
RIYADH: Saudi air defenses on Sunday intercepted a ballistic missile fired by Houthi militia at the Kingdom’s southern border city of Najran, which set a farm ablaze, state media said.
“Saudi forces were able to intercept (the missile),” the Saudi Press Agency said, citing the Saudi-led coalition fighting Iran-backed Houthis.
“But the shrapnel scattered over residential areas and caused a fire at a farm belonging to a citizen, without causing any injuries.”
The missile was launched from Saada, the Houthi stronghold in northern Yemen, the coalition was cited as saying.
The coalition said another missile crashed in a Saudi desert on Sunday, without specifying a location, adding it caused no damage.
Sunday’s strikes are the latest in a series of rebel bombardments on Saudi territory.
Saudi forces said they intercepted a Houthi ballistic missile targeting the Kingdom’s southern coastal city of Jizan on Friday, the second such strike in the area in over a week.
Earlier this month, Saudi forces said they intercepted rebel ballistic missiles fired at Riyadh and the south of the Kingdom, where two drones were also shot down.
Saudi Arabia has since March 2015 led a coalition of Arab states fighting to roll back the Houthis in Yemen and restore its neighbor’s internationally recognized government to power.
Nearly 10,000 people have since been killed in the conflict, in what the United Nations has called the world’s worst humanitarian crisis.
In March, an Egyptian laborer became the first known fatality in a rebel missile attack on the Saudi capital.
Saudi Arabia accuses its arch-rival Iran of smuggling missiles to the Houthis — a charge Tehran denies.