Manama: Saudi Arabia has denied reports that it was planning to increase zakat in the private sector.
Zakat is religious fees paid annually and is the fourth pillar of the Muslim faith.
“There are no current plans to increase the zakat levels in the private sector, the General Authority of Zakat & Tax said in a statement.
“The authority is committed to the best ways and means to carrying out its duties stipulated in Article Three of the Authority’s bylaws, which is the collection of zakat according to the highest levels of commitment and efficiency, in line with the best professional practices in force globally.”
The authority said it has “an important role in supporting economic development in Saudi Arabia and an attractive investment environment for the private sector in line with Vision 2030.”
Bloomberg last week said that Saudi Arabia was considering plans to increase zakat to 20 per cent, or double the current rate.
According to Bloomberg, local lenders started paying zakat at 10 per cent of profit after deducting returns on government bonds from last year as part of a settlement with the authority.
The authority in its statement said it has launched a public survey on the Zakat Regulations draft after making some amendments to the content of the regulation.
“All stakeholders have responded positively and stated their comments which the authority has received with interest and has expressed its appreciation for their input,” it said.
“In order to enhance the investment climate, and under the constant monitoring of the Council for Economic and Development Affairs, the authority has concluded settlements with a number of financial institutions and others to close their pending zakat positions. This action has had positive effects on the economy, public interest and has saved time, efforts and costs for all concerned parties.”
