WhatsApp Logo Subscribe
For News Alert

News

Saudi triples tax, halts govt living allowances in austerity drive

May 11, 2020 01:12 PM


Twitter Share Facebook Share WhatsApp Share

Saudi Arabia's finance minister on Monday said the kingdom will triple its Value Added Tax (VAT) and halt monthly handout payments to citizens in new austerity measures amid a coronavirus-led economic slump.

"It has been decided the cost of living allowance will be halted from June 2020 and VAT will be raised from 5 percent to 15 percent from July 1," minister Mohammed al-Jadaan said, according to the official Saudi Press Agency.

The measures come after Jadaan last week warned of "painful" and "drastic" steps as the government steps up emergency plans to slash spending amid the double shock of the novel coronavirus and record low oil prices.

Saudi Arabia, along with other Gulf states, imposed a five percent tax on goods and services in 2018 in a bid to generate additional revenue. The petro-state had also introduced handouts worth billions of dollars to citizens, known as the cost of living allowance, to cushion the impact of rising costs.

Jadaan has said he expected Riyadh could lose half of its oil income, which contributes about 70 percent of public revenues, as oil prices have fallen two-thirds since the start of the year. He said the world's leading crude exporter would borrow close to $60 billion this year to plug a huge budget deficit.

The International Monetary Fund in April projected that the Saudi economy would contract by 2.3 percent this year.

https://www.youtube.com/watch?v=pOavNaBX4NU


Most Read

  1. Scores of LCWU students protest harassment by clerk Scores of LCWU students protest harassment by clerk
  2. Female student of Punjab University commits suicide Female student of Punjab University commits suicide
  3. World Anatomy Day celebrated at Fatima Jinnah Medical University World Anatomy Day celebrated at Fatima Jinnah Medical University
  4. ‘Madhubala’ to be shifted to Karachi Safari Park on Nov 26 ‘Madhubala’ to be shifted to Karachi Safari Park on Nov 26
  5. Karan Johar's sharp response guels ongoing fued between Alia Bhatt and Divya Khosla Karan Johar's sharp response guels ongoing fued between Alia Bhatt and Divya Khosla
  6. Chahat Fateh Ali Khan receives hilarious reactions on his new song 'Toba Toba' Chahat Fateh Ali Khan receives hilarious reactions on his new song 'Toba Toba'