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Published:May 13, 2020

COVID-19: Saudi Arabia VAT Rate Soars up to 15%

COVID-19: Saudi Arabia VAT Rate Soars up to 15%

Saudi Arabia’s finance minister announced on Monday 11 May that the country’s VAT rate would be increased from 5% to 15%. The government is seeking much-needed revenue to make up for the significant drop on oil prices as well as a coronavirus-driven economic downturn.

The new VAT rate will come into effect from 1 July 2020 and businesses both within Saudi Arabia and abroad will need to adjust invoicing, filing and tax compliance procedures.  

“These measures are painful but necessary to maintain financial and economic stability over the medium to long term … and to overcome the unprecedented coronavirus crisis with the least damage possible,” said KSA’s Finance Minister Mohammed al-Jadaan (source).

VAT is claimable from Saudi Arabia for non-resident businesses. The higher VAT Rate makes it even more important to ensure that you are seeking a VAT refund for any A/P or T&E expenses incurred in Saudi Arabia. 

VAT IT is able to offer assistance for any businesses who wish to claim their VAT back from Saudi Arabia.



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