Saudi Arabia Offers Tax Incentives for Foreign Companies

Saudi Arabia has announced that it will provide tax incentives for foreign companies that establish their regional headquarters in the country. This includes a 30-year exemption from corporate income tax. The move is part of Saudi Arabia’s efforts to diversify its economy and reduce its dependence on oil. Crown Prince Mohammed bin Salman aims to create new industries that will generate employment opportunities for Saudi citizens. The tax exemption package for regional headquarters also includes a zero percent income tax rate for the regional entity and withholding tax on approved activities for a duration of 30 years. The program has already attracted 200 foreign companies, according to Saudi Investment Minister Khaled Al-Falih. The tax incentives aim to provide clarity and stability to international companies operating in Saudi Arabia and encourage more companies to participate in various sectors, including mega projects and upcoming events such as the Asian Winter Games in 2029 and the Expo 2030. Some foreign companies have expressed concerns about the regulatory framework, including taxation, but many have been compelled to relocate their regional headquarters to Saudi Arabia to meet the January 2024 deadline set by the kingdom.