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Saudi Arabia has announced plans to raise taxes and reduce public spending, after trying to deal with the new coronavirus epidemic (COVID-19) and the collapse of oil prices, writes The Guardian.
Value added tax (VAT) on basic goods triples up to 15% the cost of large projects is reduced by $ 26 billion, and “human subsistence costs” must be reduced.
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“We are facing a crisis that the world has never seen in modern history, a crisis marked by uncertainty, “said Mohammed Al Jadaan, Saudi finance minister and acting minister of economy and planning.
“These measures, which were taken today, difficult as they are, are necessary and useful for maintenance of overall financial and economic stability“added the Minister.
Saudi Arabia has suffered a severe epidemic from the new coronavirus, and has so far been officially registered 39,000 infected, of which 246 died. But the country has also been hit hard by falling oil prices, with crude oil now trading at around $ 30 a barrel, less than half the price in late 2019.
Saudi Arabia also abolished the death penalty for minors
The country executed at least 187 people in 2019, the highest level since 1995, when 195 people were executed.
That is all well below the level Saudi Arabia needs to balance its budget. The kingdom also lost revenue from the abolition of the Muslim cult in the holy cities of Mecca and Medina, which were closed to visitors due to the coronavirus.
The decision to cut spending by $ 26 billion, or around 100 billion Saudi riyals, includes canceling, extending, or postponing capital and operating expenses for some government agencies, as well as cutting spending on major Vision projects. 2030, which is at the heart of Crown Prince Mohammed bin Salman’s plans to modernize the country.
Employee support benefits must also be suspended Since June, this supplement has cost the state about $ 13.5 billion a year.
VAT will increase from 5% to 15% in July. The tax on most goods and services was introduced in Saudi Arabia in 2018.
Saudi Arabia executed a record number of people in 2019
According to an Amnesty report
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