Saudi Arabia to hike VAT to 15% as kingdom takes measures to buttress economy, finance minister says – The National

Saudi Arabia to hike VAT to 15% as kingdom takes measures to buttress economy, finance minister says – The National

Saudi Arabia to hike VAT to 15% as kingdom takes measures to buttress economy, finance minister says. The kingdom is increasing the value added tax from 5% and is suspending the cost of living allowance as of June. Saudi Arabia is reducing various expenditures, suspending the cost of living allowance and increasing the value added tax three-fold as the kingdom looks to offset the impact of the coronavirus pandemic on its economy and buttress its finances amid lower oil prices, the finance minister said.. Saudi Arabia will cancel, extend, or postpone some operational and capital expenditures for some government agencies, in addition to reducing provisions for a number of initiatives from its Vision 2030, the kingdom's economic diversification programme, and major projects for the 2020 fiscal year, Mohammed Al Jadaan said, according the state-run Saudi Press Agency .. The cost of living allowance will be discontinued as of next month and VAT will increase to 15 per cent from 5 per cent starting July 2020, Mr Al Jadaan added.. The crisis produced three economic shocks, "each of which could in itself have an extremely negative effect on the performance and stability of public finance had the government not intervened