CITC working to prevent price hikes on VAT, says official

Saudi Arabia’s Communications and Information Technology Commission (CITC) is working towards stopping any attempt to take advantage of levying the value-added tax (VAT) to raise the prices of telecommunications, Al-Eqtisadiah newspaper reported, citing CITC’s spokesman Adil Abu Haimed.

VAT will be calculated on the total invoices of the postpaid packages, not on each service, he said.  

As for the pre-paid SIM cards, the tax will not be added by the vendor to the card’s price, but will be imposed upon activating the card by deducting a 5 percent VAT from the card’s credit. The General Authority for Zakat and Tax (GAZT) will collect the tax amount from the mobile operator, Abu Haimed said.

The Kingdom will start levying the 5 percent VAT starting January 1, 2018.