Saudi consumers welcome decision by various companies to bear VAT burden

LuLu is giving discounts on all products mentioned in its booklet to compensate customers, while Danube and BinDawood stores have announced efforts to maintain competitive prices. (ArabsStock)
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Updated 10 July 2020

Saudi consumers welcome decision by various companies to bear VAT burden

  • KSA tripled value added tax from 5% to 15% as part of new measures to mitigate economic repercussions of pandemic

RIYADH: Saudi companies are promoting discounts on products in a bid to reduce financial pressure on customers following Saudi Arabia’s decision to triple the value added tax (VAT) from 5 to 15 percent, starting July 1.
The Kingdom announced the move on May 11 as part of new measures to mitigate the economic repercussions of the COVID-19 pandemic.
LuLu Group, the leading hypermarket chain in the Kingdom, told Arab News: “This week we have the campaign ‘VAT on us, savings on you.’ We are bearing the 15 percent VAT for the customers.”
The chain also issued a booklet with a list of products on discount.
“We are giving discounts on all products mentioned in the booklet to compensate customers,” the company said.
Ahmad AR, CEO of Danube and BinDawood, said his stores would also maintain competitive prices for consumers.
“From a grocery retail perspective, shopping will continue to remain a priority for all individuals and families. It is too early to offer a firm view or discuss the impact of purchasing habits of consumers,” he said.
“When it comes to discounts, our pricing strategy is always to maintain the most competitive prices at Danube. Customers trust our brand because the overall shopping experience we offer is unique across all verticals, including product offering,” he added.
Shoppers in the Kingdom have welcomed the campaign.
Manal Mukhtar, an English teacher at a private school in Riyadh, told Arab News: “We are already experiencing price increases without taking the VAT into consideration. Now we have this to worry about as well. I am grateful to all the companies that have offered to shoulder the additional costs while we get our bearings, but I hope the cost of living allowance will return now that lockdown is over. If the VAT is going to affect us that much, we are probably going to need it.”
Saudi Arabia suspended the cost of living allowance last month.
Khalid Sultan, a university student in Riyadh, said: “While we can’t deny that it’s generous of the companies that have offered to shoulder the additional cost of the VAT themselves, it raises the question of how long it will last.”
He added: “If it’s only a month or so, all they’re doing is prolonging the inevitable. It’s an appreciated gesture, but it only presents a short-term solution.”
Aljohara Alsubaie, an executive secretary, also welcomed the move, “especially since the news broke that we would no longer be receiving a higher cost of living allowance with our salaries.”
She hopes that larger companies will also follow suit, “especially those that can obviously afford it.”


Better in the long run: 2,600 join Saudi 10-day marathon

Updated 13 August 2020

Better in the long run: 2,600 join Saudi 10-day marathon

  • At least 40 nationalities were represented in all age groups

JEDDAH: More than 2,600 people took part in a 10-day walking and running marathon in the Kingdom, reaching a combined distance of more than 448,000 km.
At least 40 nationalities were represented in all age groups.
The Saudi Sports for All Federation (SFA) launched the “Step Together” initiative as part of a series of competitive walk-runs. The SFA event, the first since lockdown restrictions were eased, took place from July 17-26. About 30 para-athletes joined the competition, making it a hallmark achievement for SFA inclusivity.
Tahani Ibrahem, a 29-year-old Saudi participant, said her Eastern Flames football club training encouraged her to join the marathon.
“I joined one other marathon in 2019 and won fourth place. I’ve loved running since I was a teenager,” she told Arab News.
Ibrahem said that she was happy that para-athletes included in the marathon and praised the SFA for giving people and communities a chance to unite for one goal.
“They are just like us. Disability is something of the mind, not the body,” she said.
Ibrahem completed 42 km in the 10-day marathon, spending five hours a day walking and running.
“We were thrilled to see such high registration numbers for our first ‘Step Together’ event,” said Prince Khaled bin Alwaleed bin Talal, the SFA president.
“The diversity of participants for the first in the walk-run series was important to us. We recruited all ages and abilities for this event and are delighted that they made it their own. It truly was ‘Sports for All’ as we had many children and seniors take part, and we were proud to have a number of disabled competitors,” he said.
Those who met the distance goals were awarded with medals and e-certificates of the achievement. In the 21.1 km event, the fastest time was recorded by Mohammed Ayyash (1hr 11min 5sec), followed by Waleed Homidan (1hr 11min 59sec) and in third place, Osama Ayyash (1hr 23min 5sec).
Ronel Wienand, competing with the Riyadh Road Runners, was the fastest woman, completed the half marathon in 1hr 58min 7sec.