Issue of income tax not discussed in cabinet, Saudi government discussions: Source

A Saudi money changer displays Saudi Riyal banknotes at a currency exchange shop in Riyadh, Saudi Arabia July 27, 2017. (Reuters)

The issue of imposing an income tax in Saudi Arabia has not been previously discussed in any past cabinet or government discussions, the Saudi Press Agency reported citing an official source in response to media reports.

“An official source stated about what was reported by one of the international news agencies, quoting the Minister of Finance regarding the study of applying income tax, as it has not previously been discussed in the cabinet or any of the councils or governmental committees. The source also confirmed that this issue is not primarily discussed,” SPA reported quoting the source.

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A day earlier, Reuters ran a report citing Saudi Arabia’s Finance Minister Mohammed al-Jadaan’s comments at a Bloomberg event as saying there were no imminent plans to introduce an income tax. Reuters then said that “he added that nothing could be ruled out.”

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Saudi Arabia tripled its value-added tax (VAT) rate on July 1, from 5 percent to 15 percent. The announcement came in mid-May following a wave of enormous cost-cutting programs to help counter the unprecedented economic fallout caused by the ongoing coronavirus pandemic.

Discussing Saudi Arabia’s economic challenges in an interview with Al Arabiya earlier in May, al-Jadaan said that the Kingdom’s economy still depends greatly on public spending and it will therefore continue to maintain public finance to support the economy in the near future. However, he added that his ministry believes more regulations, including “painful” ones, are needed to sustain the measures.

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Last Update: Thursday, 23 July 2020 KSA 07:30 - GMT 04:30
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