The Saudi General Authority of Zakat and Tax will publish the value-added tax (VAT) draft on its electronic portal within the next two weeks, local media in Saudi Arabia reported on Wednesday. The authority added that the executive list of the tax will be complete in the third quarter of 2017, and companies will be able to start registering in the fourth quarter of the year, according to Arabic newspaper Okaz.
Hammoud Al Harbi, VAT project manager at the General Authority of Zakat and Tax, said that there will be three categories in the implementation of the tax in the kingdom: 5 percent on some goods and services, zero rated and exempted supplies and services.
The head of the legal team for indirect taxes, Misfir Al Dihaim said, “Tax collection from imported goods will be carried out in cooperation with the customs department, which will include full lists of the value of goods in the customs reports.”
The authority had earlier said that all private sector companies in Saudi Arabia with $100,000 revenue will be covered by the new VAT taxation rules, and major penalties will be enforced on those evading the tax. Companies incurring losses will not be exempted, and the registration for VAT is mandatory during the fourth quarter of this year ahead of implementing the tax starting January 2018.
