The Saudi General Authority of Zakat and Tax has warned against evading the payment of Value Added Tax (VAT) which is a felony punished by imprisonment under the law.
Saud al-Mulhim, director general of the indirect tax department at the General Authority of Zakat and Tax said that his administration is ready to apply the value-added tax next year to a number of goods and services at a rate of 5 per cent according to an agreement reached among the Gulf Cooperation Council (GCC) countries.
In the same vein, the director of the value added tax project in the General Authority of Zakat and Tax, Hamoud al-Harbi, said that companies that suffer material losses will not be excluded from paying the VAT.
He said during an introductory workshop on VAT held at the Riyadh Chamber of Commerce and Industry that “the draft Value Added Tax Law will be issued within the next two weeks, and the tax payment by institutions, companies and others will be on a monthly and quarterly basis”.
He added that each commodity subsidised by the state will have a special consideration in the system in terms of supply; noting that commodities that will be subject to zero tax rate will be determined by the GCC countries in the coming period.