Saudi citizens exempt from VAT on healthcare services

Saudi citizens will be exempt from the newly-enacted five percent value-added tax, when availing healthcare services, Saudi Press Agency reported quoting the tax authority.

The government will bear the burden of VAT on cash payments by citizens to healthcare providers. For citizens that have insurance coverage, insurers will bear the levy, said the General Authority of Zakat & Tax (GAZT).

A new mechanism is under study to refund payments made by citizens since inception of the levy on January 1.

Earlier this week, the Saudi monarch King Salman issued a series of royal decrees ordering payment of several allowances to state employees and military staff, along with other tax breaks for some citizens to offset rising cost of living.

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The state was directed to pay VAT for nationals benefiting from private healthcare and private education services and pay taxes for first-time homebuyers at a maximum of SAR 850,000.​