KINGDOM OF SAUDI ARABIA SHOULD CONSIDER RAISING THE VAT TO 10%
IMF: On 1st January 2018, Saudi Arabia introduced Value Added Tax for the first time in the history of Saudi Arabia. This effect comes after the mid-2014 plunge in oil prices. The VAT percentage was set to 5%.
In the most recent report of the International Monetary Fund (IMF) dated June. The IMF said that a more tightly monetary arrangement was required. As the Saudi spending shortfall is anticipated to widen. Saudi Arabia, the Middle East’s biggest economy stays ruled by hydrocarbon incomes. In spite of Crown Prince Mohammed bin Salman’s statement that he plans to differentiate.
International Monetary Fund (IMF) Stated
Saudi Arabia ought to consider raising the VAT Value Added Tax from current 5% to 10%. Focusing on the significance for the world’s top oil exporter improving its monetary position in the midst of lower rough costs.
Similarly, The Gulf state as of late limited rough generation by more than called for by an OPEC-drove supply arrangement to help oil markets. However, easing back oil request and the debilitating worldwide economy have held costs under strain. This is burdening the kingdom’s financial development, with certain market analysts gauging a constriction this year.
In conclusion, The IMF anticipates that the spending shortage should expand this year to 6.5% of total national output (Gross domestic product). From 5.9% of the Gross domestic product in 2018 as higher government use. it probably going to control the upside of more grounded non-oil monetary development.
Reactions of the People
Firstly, in our Facebook page, people are not responding well on this suggestion of IMF to Saudi Arabia. There are, however, some people who will disagree and some who agreed with IMF. Secondly, the effect may take place if we are looking forward to enhancing the non-oil revenue. Thirdly, most of the expat is willing to support any decision the government may take. Last, but not the least everyone stays with the government.