PricewaterhouseCoopers (PwC) Middle East recently released a tax survey that suggests that streamlining and clarifying Saudi Arabian taxes and business regimes could help the area’s businesses gain new overseas investors.
Many people see Saudi Arabia as a low tax or “no tax” nation. Unfortunately, the actual tax system is complicated and challenging for leaders to manage. This is one of the reasons that clarification and streamlining could help the nation’s businesses.
“Tax regimes in the region can be complex and challenging to manage and their implementation can give rise to uncertainty and confusion, which in turn creates risk,” Dean Kern, PwC Middle East tax and legal services leader, said. “As a result, companies need to manage their tax affairs with the same care and attention to detail that applies everywhere else in the world.”
The survey also suggested that there needs to be clarity about applying for tax laws and which taxes are implemented in different scenarios. For example, the standards about tax residency can be viewed differently according to different tax authorities in the nation. This also happens with social security taxes included on the Saudi Stock Exchange.
“Tax administrations are also facing the challenge of being asked ‘to do more with less.’” Mohammed Yaghmour, PwC Saudi Arabia zakat and tax leader, said. “Increased use of cooperative compliance models may help increase clarity and consistency for taxpayers and more efficiently utilize resources in tax administrations.”
