Saudi Arabia to raise VAT to 15% to protect the economy
Tuesday, 05 12 2020, Category: Economy, Country: Saudi Arabia
Saudi Arabia is reducing various expenditures, suspending the cost of living allowance and tripling VAT as the kingdom looks to offset the impact of the coronavirus pandemic on its economy and buttress its finances amid lower oil prices.
The kingdom will cancel, extend or postpone some operational and capital expenditures for some government agencies, finance minister Mohammed Al Jadaan said, according to the state-run Saudi Press Agency.
Mr Al Jaadan said provisions for a number of initiatives from its Vision 2030 economic diversification programme and major projects for the 2020 fiscal year will be reduced.
The cost of living allowance will be discontinued next month and VAT will increase from 5 per cent to 15 per cent from July, he said.
The measures are intended "to protect the kingdom's economy to overcome the unprecedented global corona[virus] pandemic and its financial and economic repercussions with minimal damage," he said.
Source: The National – UAE