Billboard, ad fees to raise municipal revenues 60%

JEDDAH: The Council of Ministers on Monday amended fees on lit and unlit billboard ads, ads located on private property or buses within the city, ads on Ministry of Transportation road projects, and ads located in ports, at airports and the new railways.
According to the decision, the fee per ad will be SR600 per square meter.
Fees for lit and unlit billboards for commercial stores will be SR400 per square meter.
The effects of the decision will become evident next year, as it is expected to take effect starting with the last quarter of this year.
The decision will help increase municipal revenues during the coming two years by 50-60 percent.
The CEO of one of the advertising agencies, Hazem Abu Rish, said municipal revenues last year reached SR6 billion, which is low revenue compared to those of municipalities around the world, especially as expenses amounted to SR26 billion.
“The Council of Ministers’ decision on Monday to raise the fees of billboard advertisement will increase municipalities’ revenues over the coming two years,” he said, adding that the new fees will be imposed at the end of 2016.
A member of the advisory committee for the national program for exhibitions and conferences, Adel Abdulshakoor, said municipal revenues are expected to reach as much as SR10 billion.
“The previous fees for advertisements were very low, and the new fees will help the economy diversify the sources of income, not to rely solely on oil.”
He said other countries’ budgets rely heavily on municipal incomes, and the current returns do not meet Saudi Arabia’s ambitions. As such, municipalities should contribute directly to the state’s budget revenues.