According to information obtained by the Saudi Gazette, Saudi Arabia has formally started implementing its value-added tax (VAT) refund program for tourists and Gulf Cooperation Council (GCC) citizens. This program allows qualified visitors to claim 15% VAT on qualifying purchases through 1,442 authorized retail outlets throughout the Kingdom.
The action is a component of the Kingdom's larger initiatives to improve travel and shopping and raise Saudi Arabia's profile as a world travel destination.
Tourists who are not residents and are at least 18 years old can use the VAT refund system.
The products must be unused, used for personal purposes solely, and exported within 90 days of purchase in order to be eligible, and the total purchases must exceed SR500.
In addition to some goods like cars, boats, airplanes, food and drink, tobacco products, and petroleum derivatives, services like lodging and meals are not included.
Customers may combine up to three invoices from the same shop on the same day in order to meet the eligibility criteria, and they can seek a VAT exemption form at the moment of sale by providing their passport or GCC ID.
There are currently 18 verification points at three international airports where travelers must validate their tax-free form before departing: 10 at King Khalid International Airport in Riyadh, 4 at King Abdulaziz International Airport in Jeddah, and 4 at King Fahd International Airport in Dammam.
With a daily cash refund cap of SR5,000 per individual, refunds can be made in cash or by card. However, King Abdulaziz Airport in Jeddah's North Terminal does not offer cash refunds.
In addition to streamlining shopping experiences and encouraging tourists to prolong their vacations and explore more of Saudi Arabia's retail scene, the VAT refund program seeks to foster sustainable tourism expenditure.
