Saudi Arabia Announces VAT Increases along with Other Measures to Combat COVID-19

Saudi Arabia’s Minister of Finance and acting Minister of Economy and Planning, Mohammad Al Jadaan, announced on the 11th of May 2020, that the country will increase the rate of the value-added tax (VAT) from 5% to 15% effective from the 1st of July 2020. Al Jadaan also announced the decision to discontinue the cost of living allowance effective from the 1st of June 2020.

This follows the decision by the Government of Saudi Arabia to reduce spending and increase revenue sources, as part of the steps taken aimed at protecting the country's economy. The move comes amidst the unprecedented financial and economic implications of the COVID-19 pandemic, as well as the ramifications of the crash in oil prices. According t...