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Saudi Arabia to Introduce VAT Refunds for Tourists Starting in 2025

Saudi Arabia to Introduce VAT Refunds for Tourists Starting in 2025

Web Desk November 29, 2024 Add Bol News as a trusted source
  • Saudi Arabia plans to launch a VAT refund system for tourists in 2025 to boost the tourism sector.
  • The system will be managed by the Saudi Zakat, Tax, and Customs Authority.
  • The system will allow international tourists to claim back VAT paid on eligible purchases.
Saudi Arabia is set to launch a value-added tax (VAT) refund system for tourists in 2025, aiming to enhance the tourism sector and attract more foreign visitors. This move is part of Saudi Arabia’s broader strategy to become one of the world’s top 10 tourist destinations by leveraging its rich cultural and religious heritage.

The VAT refund system will be managed by the Saudi Zakat, Tax, and Customs Authority, which plans to streamline tax processes and improve the tourism experience. The system will allow international tourists to claim back VAT paid on eligible purchases during their visit. However, some goods, such as vehicles, tobacco, and food items, will be excluded from the refund.

Saudi Arabia is targeting 127 million visitors by the end of 2025, with an expected tourism revenue of SAR 346.6 billion. This growth is expected to provide a significant boost to the national economy, diversifying non-oil revenues and increasing demand for private sector services.

To further support its tourism goals, the country introduced a tourist visa system in 2019 and a four-day transit visa in 2022. These efforts have already seen a significant rise in tourist numbers, with over 100 million visitors recorded in 2023, including 77 million domestic and 27 million international tourists.

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