Saudi telcos set to apply VAT on post-paid, pre-paid bundles starting Jan 1

Saudi telecom operators are gearing up to implement the value-added tax (VAT) on the pre-paid and post-paid bundles starting tomorrow.

Etihad Etisalat Co. (Mobily) and Mobile Telecommunication Company Saudi Arabia (Zain) said VAT will be levied on all post-paid voice and data services, based on the invoice total due sum at the beginning of every month.

For Mobily’s new pre-paid packages, VAT will be deducted from the initial balance, but will be cut from the recharge sum for the current customers.

Zain will pay the VAT for the new pre-paid customers, but will implement the new tax on the recharge amount for the current subscribers.

According to Mobily, a 5 percent tax will be added to the pre-paid data packages. For the post-paid data cards, the new tax will be added to the total due amount.

The recharge cards are subject to the VAT according to different bundles.