New Zakat collection, comprehensive investment laws ‘in the making’: Al-Falih

Minister of Investment Khalid Al-Falih

The Saudi government is currently drafting a new Zakat collection law and will also introduce a comprehensive investment law, Minister of Investment Khalid Al-Falih stated.

Speaking at the second edition of the Municipal Investment Forum (FURAS), Al-Falih said that there are discussions with officials in the Zakat, Tax and Customs Authority (ZATCA) to ensure that the Zakat Collection Law achieves ease of doing business and transparency for investors.

Regulations of the Zakat collection law are in the making, the minister said.

"We are also reconsidering the corporate income tax … There could be some initiatives in this regard,” Al-Falih added.

The practices and legislations related to taxes and Zakat will be reviewed, as Saudi Arabia has competitive taxation compared to other countries.

He emphasized that the law aims for the financial compensation, fees, taxes and Zakat to be as clear and low as possible.

Investors will be able to invest capital, effort, and ideas, and receive an attractive return that competes with any other country.

Investors’ profitability is the most important for the ministry to be reinvested in the economy, he highlighted.

On the other hand, Al-Falih indicated work is ongoing on introducing a comprehensive investment law, to replace the current foreign investment law, in order to protect and clarify the rights of local, foreign, and Gulf investors.

The new law will unify the identity of investors. It is in final stages and will be presented to the Shura Council in Q1 2023. It is likely to  be issued by Q2 to Q3 2023 after obtaining Saudi Cabinet’s approval.

The minister confirmed that the new law will reduce the Kingdom's need to enter into investor protection agreements with other countries.

The Law of Real Estate Ownership and Investment by Non-Saudis is also in its final stages, focusing on opening real estate investment for companies, individuals, residents, and non-residents to own real estate in Saudi Arabia.

The law is in final review but will not take effect until adopted by Saudi Cabinet, Al-Falih said.

During the coming period, the law will be studied in cooperation with the Real Estate General Authority, and a comprehensive review of real estate affairs will take place to replace it with a unified law.