JEDDAH: The introduction of value-added tax (VAT) next year will directly impact the prices of commodities and services, analysts said.
“The price increase will reduce the demand for goods, and this will have a negative effect on companies, most of which will likely take several measures to keep their business,” Khalid Al-Zaidi, a financial analyst, told Arab News.
He hoped the price rise would not affect the quality of goods and services. “If it happened, it is a negative indication. However, the price hike will push consumers to find ways to save money,” he said. Businesses must register for VAT by the deadline of Dec. 20, and the official introduction starts on Jan 1.
Al-Zaidi also said there would be a sharp drop in demand for luxury goods and accessories.
He anticipated that companies will be keen to improve their services at competitive prices, especially with the opening of international markets through e-commerce. He stressed that the best service-providers with the lowest costs will succeed in the market, while other businesses will fail.
Al-Zaidi, who is also the director of the Jeddah-based Al-Zaidi Financial Education Center, said that it is possible that the government will impose additional taxes on other products or increase VAT from 5 percent.
“If the results are found to be supportive to the country’s economy and helps citizens to rationalize their consumption habits, additional taxes will be implemented,” he said.
On the up side, Al-Zaidi said that once VAT is imposed on petroleum products, the country will be able to cut domestic consumption of oil products.
“This will help Saudi Arabia increase the quantity of its oil reserves and enable it to increase its export of oil to the international market,” he said.
He added that this could support its global position as an important player in the oil market. “It will also strengthen its oil pricing policy inside OPEC (the Organization of the Petroleum Exporting Countries),” he said.
Al-Zaidi anticipated that small and medium-sized companies will find it difficult to adapt to VAT, making it difficult to significantly reduce their expenses to survive.
As for imposing VAT on private education, Al-Zaidi said that investors in this sector would reduce fees to retain their market share. “Otherwise, their investment would be severely affected,” he said.
Khaldoun Khan, the owner of Al-Corniche International School and Al-Faisal International School, told Arab News that students’ guardians would be affected by the decision, and he would not increase registration fees. He said that his schools would lose some students. “Students have started to join state schools due to the decision,” he said.
Khan said that he would have another look at the profits and consider providing students with attractive offers to keep his business alive. “Unless the government reviews the decision, many school owners will choose to close their schools,” he said.
The General Authority of Zakat and Tax (GAZT) has urged businesses with annual revenues of more than SR1 million ($266,640) to expedite their VAT registration process and ensure their readiness for its implementation.
More than 60,000 businesses have registered for VAT since registration started on Aug. 28, 2017.
Businesses that fail to register in time will face fines of up to SR10,000 and the suspension of several critical government services, including issuing work permits, changing business activity, issuing visas, transferring workers’ sponsorship and other services provided by the Ministry of Commerce and Industry, the Ministry of Labor and Social Development, the Ministry of Municipal and Rural Affairs, Saudi Customs and the Saudi Arabian Monetary Agency.
The GAZT confirmed that VAT will be implemented on Jan. 1 next year, and that all eligible businesses must be ready and aware of its laws, regulations and requirements — available on the VAT website vat.gov.sa.
The GAZT first imposed a selective tax on energy drinks, cigarettes and soda drinks. It also increased the visit visa fee, exit re-entry fee and dependent fee for expatriates.
Saudi VAT impact: Price hike ‘will push consumers to find ways to save money’
Saudi VAT impact: Price hike ‘will push consumers to find ways to save money’
New Saudi envoy to Oman presents credentials to Sultan Haitham
MUSCAT: Saudi Arabia's envoy to the Sultanate of Oman presented his credentials to Sultan Haitham bin Tariq at the Al Baraka Palace on Thursday, the Saudi Press Agency reported.
Ambassador Ibrahim bin Saad bin Bishan also presented his credentials to Oman's Foreign Minister Sayyid Badr bin Hamad al Busaidy, the Omani news agency reportedly separately.
In the meeting, Sultan Haitham commended the Saudi-Omani historical ties and their continued progress across various sectors.
Saudi Arabia and Oman are both members of the Gulf Cooperation Council (GCC), which also includes Bahrain, Kuwait, Qatar and the United Arab Emirates.
Ambassador bin Bishan conveyed greetings from Saudi King Salman and Crown Prince Mohammed bin Salman to the sultan, wishing the Omani people continued prosperity.
Ambassador Ibrahim had previously been supervisor of the Yemen operations room and minister plenipotentiary at the Saudi Ministry of Foreign Affairs.
4th Global Ministerial Conference on Antimicrobial Resistance kicks off in Jeddah
- Three-day conference aims to enhance international efforts to confront challenges associated with antimicrobial resistance
RIYADH: The fourth high-level Global Ministerial Conference on Antimicrobial Resistance kicked off in Jeddah on Thursday under the theme “From declaration to implementation – accelerating actions through multi-sectoral partnerships for the containment of AMR.”
The three-day conference, being held under the patronage of the Ministry of Health, includes ministers of health, environment and agriculture from various countries, besides the participation of a number of heads of international organizations such as the World Health Organization, the Food and Agriculture Organization, the World Organization for Animal Health, and non-governmental organizations such as the Bill and Melinda Gates Foundation, in a move to enhance international efforts to confront the escalating challenges associated with antimicrobial resistance, which has become a threat to global health.
Saudi Minister of Health Fahd Al-Jalajel stressed that the conference is an opportunity for the international community to commit to a unified roadmap and set clear guidelines that will help address the increasing drug resistance in humans and animals.
Antimicrobial resistance poses a threat to all age groups, as it affects human, animal and plant health, as well as the environment and food security.
To curb the spread of antimicrobial resistance, the minister explained that we must adopt a comprehensive approach that systematically addresses the challenges that hinder progress, including sharing best practices, innovative financing initiatives, and developing new tools to combat antimicrobial resistance, stressing that the meeting is a vital opportunity to strengthen our collective global response to the risks of this growing “silent epidemic.”
Director General of the World Health Organization Dr Tedros Adhanom Ghebreyesus said that antimicrobial resistance is not a future threat but a present one, making many of the antibiotics and other medicines we rely on less effective, and routine infections more difficult to treat.
He praised Saudi leadership in hosting the conference, stressing that the world must work together across a range of sectors, health, environment and agriculture, to stop the spread of antimicrobial resistance.
He pointed out that the Jeddah meeting will help coordinate global efforts across diverse ecosystems, including human, animal and agricultural health, in addition to protecting the environment.
A number of countries have already resorted to imposing laws that prevent the dispensing of antibiotics in pharmacies without a prescription, and the use of antibiotics in animal farms such as poultry and livestock has been regulated in a bid to slow resistance.
Saudi and British defense ministers hold talks on cooperation and Middle East security
- Prince Khalid bin Salman and John Healey discuss ‘joint efforts to address regional challenges’ and ‘shared vision’ for regional and international security and stability
RIYADH: The defense ministers of Saudi Arabia and the UK held talks on Thursday on cooperation between their nations and efforts to bring stability to the Middle East.
During their meeting in Riyadh, Prince Khalid bin Salman and John Healey discussed the “Saudi-British strategic partnership and explored avenues to enhance defense cooperation,” the Saudi Press Agency reported.
Prince Khalid said: “We also discussed our joint efforts to address regional challenges, as well as our shared vision to promote regional and international security and stability.”
Ahead of the talks, the British Defense Ministry said Healey would “reaffirm the UK’s commitment to a future-facing defense relationship with the Kingdom of Saudi Arabia. The defense secretary will build on the decades-long defense relationship between the (countries) to enhance cooperation on shared security priorities.”
Healey, making his first visit to Riyadh since becoming defense minister following the Labour Party’s election victory in July, was also expected to discuss with Prince Khalid the ongoing efforts to secure ceasefire agreements in Gaza and Lebanon.
Earlier on Thursday, Healey met in Ankara with Yasar Guler, his counterpart in Turkiye, a NATO ally.
Ancient organic farming practices in Taif feed growing industry
- Closed-loop farming supports environment
- Rising Saudi demand for organic products
RIYADH: Organic farming in Taif province’s villages and its serene mountain and valley farms represents a continuation of an ancient tradition.
This approach avoids synthetic fertilizers and pesticides, ensuring that farms do not damage their surrounding environment, according to the Saudi Press Agency.
Inherited organic farming wisdom from previous generations boosts the health of consumers and the vitality of soil, water, plants, and wildlife.
The farming methods practiced in Taif involve a closed-loop system in which animal and plant waste is recycled into natural fertilizers.
This approach supports crop cultivation and animal husbandry, aligning with Saudi Arabia’s Vision 2030’s food security and sustainability objectives.
Drawing upon his years of experience tending terraced fields in the Al-Shafa mountains, 80-year-old farmer Abdullah Saed Al-Talhi told the SPA that organic agriculture is a fast-growing industry.
“Consumer demand for nutritious organic products is reshaping our industry,” he explained.
“Working these mountain terraces has taught me that organic farming is more than a cultivation method — it is our legacy to future generations, ensuring sustainable food production for years to come.”
“Organic farming operates through two distinct approaches,” Al-Talhi said. “We have protected greenhouse cultivation and open-field farming, but both share the same fundamental principle: producing pure food without chemical interventions.”
He emphasized that this natural approach encompasses every aspect of farming — from soil enhancement and seed selection to pest control methods.
“The Ministry of Environment, Water and Agriculture has spearheaded remarkable efforts to advance organic farming in Taif,” he added.
The ministry offers instructional programs to budding organic farmers, supporting the establishment of new farms, increased production from existing farms, and the import and export of organic products.
Other support from the ministry includes securing certification to ensure the credibility of products in Saudi and international markets.
Speaking at a recent organic market event in Taif, Al-Talhi said: “The market for organic products is experiencing remarkable growth.”
Light fantastic: Countdown begins to Noor Riyadh 2024
- Event ‘embodies the essence of striving toward new horizons,’ curator says
- World’s largest light art festival gets underway on Nov. 28
RIYADH: The start of this year’s Noor Riyadh Festival is now just two weeks away and preparations for the annual event are well underway.
Launched in 2021, the festival is a celebration of light and the arts and includes contributions from leading Saudi and international artists. It also features community activities, workshops, discussions and shows.
Billed as the largest light art festival in the world, Noor Riyadh is part of the broader Riyadh Art initiative and aims to support and inspire young artists to drive the Kingdom’s creative economy.
This year’s theme is “Light Years Away” and a host of activities are planned at three key locations — King Abdulaziz Historical Center, Wadi Hanifa and Diriyah’s JAX District — between Nov. 28 and Dec. 14.
The title is inspired by the Thuraya star cluster, which has long been a guiding light and symbol of aspiration, according to Dr. Effat Abdullah Fadag, the curator of Noor Riyadh 2024 and board member of the Visual Arts Commission.
“This year’s theme explores our journey from Althara, or Earth, toward Althuraya, or the stars, celebrating how art can bridge the physical and metaphysical,” she told Arab News.
“‘Light Years Away’ is a theme that embodies the essence of striving toward new horizons, where light is used as a metaphor for hope, creativity and resilience.
“We want the audience to feel connected to the stars above and the Earth below, experiencing how art can unite diverse elements such as science, technology, philosophy and spirituality, fostering a shared sense of inspiration and identity.”
Among the 60 artworks on offer this year are sculptural light installations and laser shows from artists like Ali Alruzaiza and Javier Riera, who use light to reimagine iconic sites like Murabba Palace.
“The works of artists like Saad Al Howede, Kimchi and Chips explore our relationship with the environment, challenging us to reflect on our impact on the Earth,” Fadag said.
“The landscapes of Wadi Hanifa serve as a living canvas, inviting the audience to consider how we can preserve the environment and the beauty of our natural heritage.
“The JAX District is a hub for innovation, experimentation and digital creativity. Originally an industrial area, it has now transformed into a space that bridges art and technology. Here, traditional and modern techniques converge in an environment that supports the creative economy.”
Fadag said she hoped visitors would leave the festival with a renewed sense of curiosity and wonder.
“The Noor exhibition reminds us that, as individuals, we aspire to connect and engage. Art and light have the power to bring us together, inspire us and illuminate new paths forward.
“I believe these experiences will remain alive long after the festival ends, encouraging visitors to carry the festival’s light with them and continue exploring their own journeys, connecting the Earth to the sky in their unique ways.”
