Saudi Arabia’s Value Added Tax Could be Reviewed Post-Pandemic: Minister of Commerce and Investment

Saudi Arabia’s decision to triple its value added tax (VAT) to 15% effective July 2020, in efforts to off-set the impact of lower oil revenues, has resulted in an increase in inflation. Inflation in Saudi Arabia increased to 6.1% in July 2020, from 0.5% in June 2020, and has hovered around the 6.0% mark since July 2020.

Whilst the country’s budget deficit in the third quarter of 2020 saw a drastic improvement, (reaching USD 11 billion, more than half the deficit in the second quarter of 2020) in part due to the tax increase, the rise in cost of living has been a bane to the citizens of Saudi Arabia.

Saudi Arabian authorities increased the VAT in July 2020, despite the In...