Government of Saudi Arabia to Impose 5% VAT

Minister of Religious Affairs Lukman Hakim Saifuddin

Starting 1 January 2018, the Government of Saudi Arabia imposes 5 percent Value Added Tax (VAT) on food, clothes, electronics, gasoline, phone, water, and electricity bills, as well as hotel reservation.<>

Therefore, the Ministry of Religious Affairs is now analyzing the impact of this policy to the cost of 2018 Hajj. “We are now reviewing the cost for 2018 Hajj. Of course the cost will increase because the 5 percent VAT apply to all components of accomodation, food, and transportation,” Minister of Religious Affairs says after leading the Commemoration of Ministry of Religious Affairs’ Charity Day in Jakarta, on Wednesday (3/1). This review is conducted to ensure that the increase of Hajj cost is not too high.

The Minister received confirmation about this 5 percent policy two weeks ago when he visited Saudi Arabia to discuss and sign the MoU on Hajj Pilgrimage 1439H/ 2018M. (Humas Kemenag/ES) (MMB/YM/Naster)