Riyadh: The Kingdom of Saudi Arabia (KSA) has announced a 30-year tax-relief package for foreign companies that establish their regional headquarters in its capital city Riyadh.
The decision was taken in coordination with the Ministry of Finance and the Zakat, Tax and Customs Authority (ZATCA).
The move aims to promote and facilitate the establishment of regional headquarters in the Kingdom.
The tax-relief package includes a zero-percent rate for corporate income tax and withholding tax related to the “approved regional headquarters activities,” the Saudi Press Agency (SPA) reported.
“The tax incentive gives multinational companies operating in the region yet another reason to make Saudi Arabia home to their regional headquarters, on top of other benefits such as relaxed Saudisation requirements and work permits for the spouses of regional headquarters executives,” said Khalid Al Falih, Minister of Investment.
“This new incentive gives business more visibility and certainty for future planning as MNCs expand their presence in the region through Saudi Arabia while also taking part in our own transformation journey,” Mohammed Al Jadaan, Minister of Finance, said.
“We look forward to welcoming more MNCs to participate in projects across all sectors, including our giga-projects and in preparation for the hosting of such events as the 2029 Asian Winter Games and Expo 2030.”
In February 2021, Saudi Arabia announced that it would stop contracting with any foreign company or commercial institution whose regional headquarters are not located in Saudi Arabia, effective from January 1, 2024.
The program has so far licensed over 200 companies to operate their regional headquarter from the Kingdom, according to SPA.