The Saudi Cabinet approved on Monday a GCC-wide measure for implementing a value added tax (VAT) of 5% on certain goods, according to reports.
The Unified Agreement for Value Added Tax, which will be implemented throughout the Gulf Cooperation Council (GCC) starting next year, is in line with Saudi Arabia’s goals of diversifying government revenues away from oil.
The GCC countries have already agreed to implement selective taxes on tobacco, and soft and energy drinks this year. The tax on tobacco, now at 50 percent, will be increased to 100 percent, the same level as those for energy drinks and sodas.
