Saudi Arabia's 15% VAT Comes into Effect
Following the double hit of the coronavirus pandemic and an oil price slump this year, Saudis now see further potential inflation as the Kingdom's 15% VAT came into effect from July 1 2020.
In last few days retailers in the country have reported a sharp jump in sales in everything from electronics to cars to building materials and cosmetics.
According to Saudi state media the hike in VAT is expected to boost government coffers by $26.6 billion over the next year.
Another financial hit taken Saudi government this year is due to the cancellation of the Haj pilgrimage that brought in about 2.5 million visitors annually. This year not more than a thousand pilgrims will be allowed.
A 5% VAT was introduced in Saudi Arabia in 2018.