Saudi and UAE, first GCC countries to introduce VAT

Saudi Arabia and the UAE will be the first Gulf Cooperation Council (GCC) countries to implement Value Added Tax (VAT) from January 1 2018, said a senior government official.

“The UAE and Saudi Arabia will be the first countries to roll out VAT in the GCC from early 2018 while other Gulf countries have time till the end of next year to implement the new tax system,” said Khalid Ali Al Bustani, Director General of Federal Tax Authority (FTA).

The rate for VAT is 5%, where excise tax is 100% on tobacco and energy drinks, and 50% on soft drinks, excluding sparkling water.

For businesses that meet the minimum annual income of SAR375,000, confirmed by their financial records, it is mandatory that they register with the VAT system.

Leave a Reply