Saudi Arabia to implement selective tax from June 10

Sunday, May 28, 2017

Dubai

Saudi Arabia will start taxing cigarettes, energy drinks and carbonated drinks from June 10, the Saudi Gazette said on Sunday, quoting the General Authority of Zakat and Tax, making it the first country in the Gulf Cooperation Council (GCC) to fix the implementation date.

On May 23, the decision was taken by the General Secretariat of Gulf Cooperation Council to impose 100 per cent tax on cigarettes and energy drinks, and 50 per cent on carbonated drinks.

“Those who import or produce commodities liable to selective tax and don’t register the required information with the Authority will be considered as tax evaders,” the Saudi Gazette said in a report. The selective tax revenues will reach 7 billion Saudi riyals in six months.

The Zakat Authority is responsible for collecting VAT (value-added tax) and ST (selective tax), ensuring that all taxpayers comply with relevant laws.

“If registered people (traders, importers etc.) fail to present a tax declaration to the General Authority of Zakat and Tax, then they will be penalized by a fine ranging between 5 per cent and 25 per cent of the tax value,” the state-run agency said.

Among the other taxes, VAT will get implemented from January 1, 2018, in Saudi Arabia and the United Arab Emirates as well as the other GCC states.

Staff Report

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