AI Summary
Several Tadawul-listed companies have disclosed the expected impact of implementing the updated Idle Land Tax regulation in Riyadh.
The total area of taxable land owned by companies reporting such impact so far amounts to nearly 4.2 million square meters (sqm). These companies include Dar Al Arkan Real Estate Development Co., Riyadh Development Co. (ARDCO), and Saudi Real Estate Co. (Al Akaria).
Meanwhile, five other companies do not anticipate a material effect from the updated executive regulations of the Idle Land Tax.
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Companies that Disclosed Expected Impact from Idle Land Tax |
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Company |
Expected Impact |
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Dar Al Arkan |
The company said that, based on a preliminary assessment of properties within the designated geographical zones, about 2.65 million sqm of these land areas are located in north Riyadh, subject to a 5% levy. Another 181,000-sqm plots is classified under a 10% levy. Details |
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Riyadh Development
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The company explained that the land subject to the tax includes: 1- a plot in the Ar Rimal district with an area of about 828,580 sqm, which falls under the fourth tranche at a 2.5% fee. 2- A plot in the Diriyah district with an area of around 18,500 sqm 3- A plot in the Al Malqa district covering 4,860 sqm, both subject to the first tranche at a 10% fee. Details |
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Al Akaria |
The company said that 487,840 sqm, or 4.65%, of its Riyadh land bank falls under the scope of the idle land tax program, as follows: The land plots subject to idle land tax are 141,560 sqm are classified under Tier 1 (highest priority - 10%), comprising several projects under development, and 346,280 sqm under Tier 4 (lowest priority - 2.5%). Details |
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Retal |
The company said that no owned lands within the company’s portfolio in Riyadh fall under the scope of the Idle Land Tax. Details |
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Almajed Oud |
The company said it does not expect a material impact on its financial position or operating plans from the implementation of the updated executive regulations of the Idle Land Tax. Details |
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Alandalus |
The company said none of its owned lands in Riyadh fall under the scope of the Idle Land Tax. Details |
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First Avenue |
The company said it owns no idle land plots. Details |
| Ladun | No material impact as a result of the newly-introduced rules. Details |
According to Argaam data, the Ministry of Municipalities and Housing (MOMAH) last month announced the Riyadh zones covered by the tax. Annual fees are set based on priority tiers, ranging from 10% of the land’s value for the highest-priority areas, 7.5% for high-priority areas, 5% for medium-priority areas, and 2.5% for low-priority areas. Land outside development priorities is exempt from fees, though it is still counted in the owner’s total undeveloped holdings within the city.
The Idle Lands Program previously clarified how fees apply to land owned by real estate developers or land under development. Fees are mandatory for all owners, including private developers, but exclude state-owned properties. Land under development will receive a one-year grace period from the date of fee imposition to complete construction and have the bill canceled, with the option of an additional grace period under approved technical guidelines.
The program covers residential, mixed-use residential-commercial, and commercial plots in Riyadh.
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