You might have heard that the Kingdom is now open to tourism, and if you really keep up then you wouldn’t have missed the thing about VAT being introduced here next month. 

Well, we’ll bet you’ve yet to hear this…

The General Authority of Zakat and Taz (GAZT) announced on Sunday that a new system will be introduced for tourists with value-added tax (VAT). According to Arab News, tourists could receive a refund on the VAT they receive while in Saudi Arabia. 

The new system won’t be applied in the early stages of next year though

According to executive regulations, it is possible for companies to return the VAT to tourists on products they are taking to their countries. The mechanism will be decided later as we are still working on the process, mechanisms, rules and payment. Some countries, for example, specify what amount to return; if it is less than €100 (SR445) it won’t be returned.

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Hamoud Al- Harbi, Director of VAT Operations Center GAZT (via Arab News)

ماهي عقوبة عدم سداد الضريبة المستحقة في المواعيد النظامية المحددة؟ pic.twitter.com/z6d9NU3KZ3

— ضريبة القيمة المضافة (@saudivat) December 13, 2017

Expat tourists living in the GCC won’t be included in this new system 

Unfortunately, if you’re an expat tourist visiting Saudi from the UAE, Bahrain or any other GCC country- you are exempt from the new system. However, tourists from other countries have to submit an application to have their VAT be reimbursed while they’re in the Kingdom. 

How amazing is that?

Process

The only other thing that tourist would need, other than the application form’s submission, is the proof of VAT payment (e.g. receipts). 

Saudi Arabia will impose VAT effective from January 1st, 2018 and it will start with a rate of 5%.