Saudi Arabia Is Expected To Earn This Much From VAT
While the amount of VAT being charged is a modest 5%, it is expected bring in huge revenues for the country.
According to the Argaam financial news portal, the Kingdom is expected to generate a whopping SAR 35 Billion in 2018 – this roughly amounts to 9.3 Billion US Dollars.
Hamoud Al Harbi VAT Project Manager at the General Authority of Zakat and Tax has said: “A total of SAR 35 billion in revenue is expected during the first year of applying the tax in the Kingdom.”
The implementation of the VAT is part of the IMF directive towards Gulf countries to diversify from oil revenues. Saudi Arabia and UAE are the first to implement it, other countries part of the GCC are expected to implement it in 2019.
The UAE, on the other hand, estimates its VAT income to be around 12 billion dirhams ($3.3bn) as reported in the BBC.
The 5% levy is being applied to the majority of goods and services. The ones that are being exempted include medical treatment, financial services and international transport.
