Saudi Arabia announces SAR 120 bln coronavirus precautionary measures: Al Jadaan
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Saudi Arabia’s government launched SAR 120 billion initiatives to implement urgent measures to mitigate the impact of coronavirus on the Kingdom’s economic activities, including the private sector, Mohammed Al-Jadaan, Minister of Finance, Economy and Planning said.
Initiatives worth SAR 70 billion were launched to support the private sector, especially the small and medium enterprises (SMEs), and other economic activities. They include exemptions and postponement of some government dues to to provide the private sector with liquidity and enable it to manage continuity of their economic activities.
Moreover, the Saudi Arabian Monetary Authority (SAMA) launched an SAR 50 billion financing package last week to support the private sector, especially SMEs, and mitigate the potential economic impacts of the coronavirus outbreak.
The urgent initiatives include:
The exemption of expats with expired residence from expat levy as of today, March 20, through June 30, 2020. Residency will be extended for three months without charge.
Employers will be allowed to redeem the fees of issued work visas, which have not been used during the ban on entry and exit. Otherwise, those visas will be extended for three months for free.
Employers will be enabled to extend exit and re-entry visas that were not used during the ban on entry and exit from the Kingdom for a period of three months without charge.
Business owners will be allowed to postpone payment of value-added tax (VAT), selective tax and income tax for three months. Also, they will be allowed to postpone submission of Zakat declarations and payment of Zakat.
Zakat certificates will be granted without restrictions for the fiscal year 2019, and installment requests to the General Authority of Zakat and Income Tax (GAZT) will be accepted without applying the condition of advance payment.
In addition, the execution of services suspension procedures and financial seizure by GAZT was postponed, and the necessary criteria was set to extend the postponement period for the most affected activities as needed.
The Kingdom will postpone the collection of customs duties on imports for 30 days under a bank guarantee for the next three months.
Payment of some government services fees, and the municipal fees accrued on private sector enterprises will be postponed.
The finance minister will be authorized to approve lending, other forms of financing, and exemption from payment of fees and returns on loans granted until the end of 2020 under the Corporate Sustainability Program initiative.
A committee will be formed to determine incentives, facilities, and other initiatives that are launched by the National Development Fund, or any affiliated funds or banks to alleviate the exceptional economic impacts of the novel coronavirus and the precautionary measures taken by the government amid lower oil prices.
The committee will also set those initiatives regulations, and the funds that will be injected to support these plans.
Al-Jadaan added that Saudi Arabia will use all available instruments to mitigate the impact of coronavirus on economic activities and private sector, and ensure fiscal stability.
Meanwhile, the budget expenditure will be redirected to the most affected economic sectors. Additional funds will be allocated for the healthcare sectors, when necessary.
In addition, an emergency budget was developed to cover costs amid the rapid spread of the coronavirus.
Ministerial committees will be also formed to study the impacts of the coronavirus in various sectors, the minister concluded.