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

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 rejects US position on Israeli settlements

Updated 1 min 18 sec ago

Saudi Arabia rejects US position on Israeli settlements

RIYADH: Saudi Arabia said on Wednesday it completely rejected Washington’s statement on Israeli settlements in the West Bank, state news agency SPA reported.
US President Donald Trump’s administration on Monday abandoned the position held by the United States for four decades that the settlements were “inconsistent with international law.” 
An official foreign ministry source expressed “the Kingdom’s utter rejection of the US government’s statements that the Israeli settlements in the West Bank are legitimate and do not violate international law.”
The source added that Israel’s construction of the settlements is contrary to the resolutions of international legitimacy and international law, and stands as an obstacle to achieving peace and stability in the Middle East and a two-state solution.
The source said that achieving lasting peace requires the Palestinian people to obtain their full legitimate rights in accordance with the Arab Peace Initiative and the resolutions of international legitimacy.