Saudi Arabia considers income tax for foreign residents
Saudi Arabia’s finance minister confirmed that the kingdom was considering imposing income tax on foreign residents as it seeks to raise non-oil revenues and cut spending to fund its $72bn plan to diversify the economy.
Income tax on the one-third of residents who are non-Saudis would raise a significant amount of non-oil revenue for the government. However, it could also make luring expatriates to the conservative kingdom more difficult. Like other Gulf states, Saudi’s income tax-free status is key to attracting foreigners.
Ibrahim al-Assaf, the Saudi finance minister, sought to clarify confusion over the tax issue at a news conference in Jeddah on Tuesday, saying it was “a proposal”.
“Nothing has been approved yet and it will be examined,” he added.
Mr Assaf downplayed analysts’ scepticism that The National Transformation Plan is overly ambitious and will fail to break the cultural and bureaucratic resistance to the deep-seated change in a country where citizens are used to generous handouts and benefits.
Original Story at FT.