KSA releases VAT law

9 August 2017 by AURIFER
On Friday 29 July 2017 the Kingdom of Saudi Arabia released its VAT law. It is the first piece of VAT legislation published in the GCC and therefore sets the tone for the other Member States.

The law follows the unique structure of the previous draft law. Although likely not compliant with the Saudi Basic Law, the VAT law refers to a great extent to the VAT Agreement concluded between the GCC Member States.

The level of detail in the VAT law is therefore quite limited. It does contain a number of the penalty provisions since these had to be included in the law, and not in the implementing regulations. The same thing holds for the appeal provisions. 
According to the law, VAT will apply on all imports and supplies of goods and services as of 1 January 2018. The extent of the exemptions and zero rates will be determined in the implementing regulations. Tax payers who register late will incur a penalty of 10,000 SAR.

The issuance of invoices or payments before 1 January 2018 will be disregarded if the supply is made after 1 January 2018.