Saudi Arabian capital Riyadh with the Kingdom Tower viewed through a window of the Al Faislia Tower there. Image Credit: AP

Dubai: The Saudi General Authority of Zakat and Tax (GAZT) extended the waiver period of fines and financial penalties for non-payment of Value Added Tax (VAT) until June 30, 2021, local media reported.

In a statement, the authority said the move is part of the Kingdom’s initiatives to stimulate the economy and help the private sector face the economic fallout resulting from the coronavirus outbreak.

As part of the initiative, taxpayers will be exempted from fines on delays in the payment of taxes or filing tax returns. They will be also exempted from the penalties imposed for correcting tax returns under the value-added tax (VAT) law.

Taxpayers will be 100 per cent exempted from fines if they fully pay the principal tax amount under the relevant tax return during the period from January-March 2021.

The GAZT added that 75 per cent of fines will be waived if taxpayers fully pay the principal tax under the relevant return during the period from April-May 2021. A 50 per cent waiver will also apply to taxpayers who fully pay the principal tax under the relevant tax return during June.

Waivers will also apply to the same penalties that might arise from any assessment or reassessment by the GAZT for any tax return that should be submitted ahead of the effective date of the initiative (Jan. 21, 2021). This comes on the condition that the principal amount is paid under the tax return or the reassessment by the GAZT.

Waivers will apply according to the periods during which the principal tax amounts are paid.

Moreover, a 100 per cent waiver of unpaid fines will be received if the principal tax amount was fully paid before Jan. 21.

On the other hand, the GAZT said the measure does not include any waivers of penalties that were imposed by the authority, other than delays in tax payments, submission of tax returns and correction of tax returns. The initiative does not also cover the fines imposed for tax evasions and the fines paid before January 21.