Saudi Arabia Offers 30-Year Tax Exemption to Multinationals Relocating HQs

KSA, February 18, 2024 : The Umm Al-Qura Gazette of Saudi Arabia recently delineated the stringent criteria multinational corporations must satisfy to qualify for a lucrative 30-year income tax exemption upon relocating their regional headquarters to the Kingdom. Unveiled in December 2023, this incentive program represents a bold bid to entice foreign investment, offering a comprehensive suite of tax breaks, including a zero percent income tax rate and withholding taxes, for three decades following the acquisition of a regional headquarters license.

Yet, securing these tantalizing incentives hinges on strict adherence to regulations, with any hint of tax evasion or misrepresentation deemed grounds for disqualification. Moreover, the program extends beyond mere tax benefits, incorporating additional perks such as relaxed Saudization requirements and provisions for work permits for executives' spouses.

Underpinning these incentives are stringent economic criteria, mandating the possession of a valid license, adequate assets, and the maintenance of a robust local presence. Oversight of compliance falls squarely to the Zakat, Tax, and Customs Authority, vested with the authority to mete out penalties for violations. Such penalties may range from corrective measures to the outright revocation of incentives in cases of misconduct or non-compliance.

In essence, the program marks a bold gambit by Saudi Arabia to foster a vibrant investment climate while upholding the highest standards of regulatory integrity and transparency.

Source : https://www.saudigazette.com.sa/