OIL-RICH SAUDI ARABIA TO INCREASE VAT FROM 5% TO 15% FROM JULY 1
BUSINESS - Posted on: 12th May. 2020 at 1:16PM
As the effect of COVID-19 is hitting many world economies, Saudi Arabia, an oil-rich country is not spared due to global oil price which has nosedived.
The Saudi government has announced in Riyadh that it is going to triple its VAT rate from July 1, 2020, as a measure to generate more revenue post-COVID19.
It also stated that it will suspend "its cost of living allowance."
The Saudi finance minister Mohammed al-Jadaan said VAT will increase from 5% to 15% as of 1 July, while the cost of living allowance will be suspended from 1 June.
The Saudi news agency explained that "The allowance of 1,000 riyals ($267; 245 euros) per month to state employees was introduced in 2018 to help offset increased financial burdens including VAT and a rise in the price of petrol."
Mohammed Al Jadaan said, "These measures are painful but necessary to maintain financial and economic stability over [the] medium to long term... and overcome the unprecedented Coronavirus crisis with the least damage possible."
As the effect of COVID-19 is hitting many world economies, Saudi Arabia, an oil-rich country is not spared due to global oil price which has nosedived.The Saudi government has announced in Riyadh that it is going to triple its VAT rate from July 1, 2020, as a measure to generate more revenue post-COVID19.
It also stated that it will suspend "its cost of living allowance."
The Saudi finance minister Mohammed al-Jadaan said VAT will increase from 5% to 15% as of 1 July, while the cost of living allowance will be suspended from 1 June.
The Saudi news agency explained that "The allowance of 1,000 riyals ($267; 245 euros) per month to state employees was introduced in 2018 to help offset increased financial burdens including VAT and a rise in the price of petrol."
Mohammed Al Jadaan said, "These measures are painful but necessary to maintain financial and economic stability over [the] medium to long term... and overcome the unprecedented Coronavirus crisis with the least damage possible."
Posted by: Emdee David
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