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Saudi phone, utility bills to increase 5%

Saudi phone, utility bills to increase 5%

Value added tax will be applied to phone bills in the country

Consumers in Saudi Arabia will have to pay 5 per cent more on their phone and utility bills from January 1 with the implementation of value added tax.

Saudi Gazette cited sources as confirming all telecom services will be subject to VAT with talk time on prepaid cards expected to be reduced.

This will mean the value of a SAR100 voucher will drop to SAR95 after the implementation of VAT.

For post paid users a 5 per cent charge will be added to post-paid bills, but it is unclear if this will apply to the subscription amount or only the call cost.

Roaming charges when travelling between Gulf Cooperation Council countries will be exempt from VAT.

The changes will effect the kingdom’s 43.63 million mobile subscribers, 3.75 million landlines and 24 million data users.

The 5 per cent VAT rate is being implemented across all the Gulf Cooperation Council countries next year but so far only the UAE and Saudi Arabia have confirmed they will implement VAT from January 1.

Read: All GCC states still committed to VAT but dates will vary, IMF says

The UAE’s Federal Tax Authority warned companies this week that they had only a limited time to register to pay VAT before the deadline.

Read: UAE’s tax authority urges firms to register for VAT ahead of deadline

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