RIYADH: The Saudi General Authority of Zakat & Tax (GAZT) has opened registration for value-added-tax (VAT) on its online portal, a local newspaper reported, adding that there will be a 10,000 Saudi riyals ($2,666) penalty for the eligible businesses and entities that do not register within the deadline. A note on the VAT official website says that “GAZT starts VAT pre-registration. Eligible businesses will receive a notification with further details.”
All entities and companies with an annual revenue of more than 375,000 Saudi riyals will be required to register for the tax by December 20, 2017. An official at the tax authority told Al Madina newspaper that the implementation of the penalty system for those evading or violating the tax law will start in January along with the official introduction of VAT in January 1, 2018. In relation to what particular sectors and industries will be exempt from VAT, the official says that the Gulf Cooperation Council countries agree on the basics and the framework of the tax, but individual countries have the authority to exempt certain sectors as it deems fit. All non-residents carrying out economic activities but with no fixed place of business in the kingdom are required to register if they are within the VAT eligibility criteria, but they need to have one tax representative in Saudi who is approved by GAZT.
