How does Value Added Tax (VAT) works in Saudi Arabia - Saudi Expatriate

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How does Value Added Tax (VAT) works in Saudi Arabia

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Introduction of VAT in Saudi Arabia from 2018 as per the Saudi Finance Minister will bring few changes and increased prices moving forward.

All the GCC Countries have already agreed along with King Salman for VAT to be applied.

Get More Details about VAT in Saudi Arabia here.

How does Value Added Tax (VAT) works in Saudi Arabia-SaudiExpatriate.com

Know how VAT will work in Saudi

  • A trader registered for VAT effectively pays VAT only at one stage when he sells his goods
  • This tax is the only amount has an effect on his selling price which includes VAT
  • The VAT that he has paid as a part of his purchase price is charged on him by his suppliers
  • This is not a cost to him because he gets it back by deducting it from tax on his sales (Output Tax)
  • Therefore, VAT should have a minimum impact on his selling prices

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