Saudi Arabia opens VAT registration

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Saudi Arabia opens VAT registration

Saudi Arabia's General Authority of Zakat and Tax (GAZT) has opened registration for value added tax (VAT) on its online portal, Thomson Reuters Zawya news site has reported.31 Aug 2017

There will be a fine of 10,000 Saudi riyals ($2,700) for eligible businesses and entities that do not register within the deadline, the news site said, citing local newspaper Al Madina.

All entities and companies with annual revenue of more than 375,000 Saudi riyals ($100,000) must register for the tax by December 20, 2017.

VAT will be officially introduced on 1 January, 2018.

An official at the tax authority told Al Madina that the penalty system for those evading or violating the tax law will be put in place in January.

Ratings agency Fitch said in February that the introduction of VAT in Gulf Cooperation Council (GCC) countries will create risks for companies and put pressure on performance and cash flows.

There will be "notable" set up and compliance costs in collecting and remitting tax to GCC governments as they introduce VAT, and businesses will need to put new IT systems in place, alongside new procedures and staff training, Fitch said.

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