On the side of a Saudi Vision 2030 meeting held on Saturday, Finance Minister Mohammed al-Jadaan explained that a review of the country's value-added tax rate will take place after achieving several targets, noting that the tax rate currently standing at 15 percent is expected to decrease to 5 percent in a period ranging between one and 5 years.
Al-Jadaan confirmed that the restructuring of the budget, and the savings achieved from raising the efficiency of public spending amounting to 400 billion riyals over the past 4 years, are important aspects of the achievements of Saudi Vision 2030 in the fifth year of the implementation of the vision.
Al-Jadaan’s speech occurred during a dialog session held by 4 ministers responsible for the vision programs on the 5-year passage of Saudi Vision 2030, which constituted a new era in economic construction.
Al-Jadaan added that the state has multiple sources of funding, including debt, reserves, and wealth in the Public Investment Fund, and he added that Saudi Arabia has assets that it seeks to privatize, but the country will remain cautious in determining budget ceilings.
When asked about the levels of issuance of sukuk and bonds, al-Jadaan said that a debt level of 33 percent of the national GDP is reasonable compared to the G20 countries.
Al-Jadaan said, “The debt levels are not worrisome at all. The kingdom has great wealth in the Public Investment Fund and has assets that are allocable and comfortable reserves.”
The Saudi Council of Economic and Development Affairs recently reviewed what had been achieved so far by the Kingdom’s Vision 2030 five years after its launch, which focused on: establishing and enabling infrastructure; building institutional and legislative structures; setting public policies, and enabling initiatives, while announcing that the focus of the next phase is to follow up implementation, advance achievements, and further enhance citizen and private sector participation.
Since the launch of Saudi Vision 2030, the rate of foreign investment flows outside the Kingdom decreased 58 percent from 2015, while foreign direct investment flows into Saudi Arabia had grown to reach 17.625 billion riyals, an increase of 331 percent from 5.321 billion riyals before the launch of the vision. These initiatives also included the launch of projects that contribute to the welfare of society, providing jobs and attracting international investments, prominently NEOM, Qiddiya, the Red Sea projects, and others.
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