SAUDI ARABIA – The Saudi Budget statement by the Zakat, Tax, and Customs Authority has revealed the Saudi government will introduce a value-added tax (VAT) refund system for tourists in 2025.
The new VAT refund system aims to streamline tax compliance while enhancing the travel experience, reflecting the Kingdom’s commitment to fostering a visitor-friendly environment and boosting its appeal as a global tourist destination.
Saudi Arabia is advancing its tourism sector with a series of strategic initiatives overseen by the Zakat, Tax, and Customs Authority.
Aligned with the National Tourism Strategy, Saudi Arabia seeks to attract 127 million visitors by the close of 2025.
This strategy focuses on both domestic and international tourism, reinforcing the Kingdom’s position as a preferred destination. Tourism spending is forecasted to hit SAR 346.6 billion in 2025, contributing significantly to the economy by increasing non-oil revenues and spurring private sector demand.
The Kingdom has already demonstrated strong progress.
In 2023, Saudi Arabia welcomed nearly 104 million tourists, surpassing its Vision 2030 milestone seven years early. This figure included 27 million international and 77 million domestic travellers, highlighting the country’s growing allure.
In the first half of 2024, the Ministry of Tourism reported 59.74 million local and international visitors.
This growth supports private sector expansion and enhances non-oil contributions to GDP. By year-end, the Kingdom is targeting a total of 119.6 million tourists, further advancing its ambitious tourism objectives.
Investment in the tourism sector has also grown significantly.
By August 2024, the sector had secured SAR 8 billion (US$2.1 billion) in investments, a figure projected to reach SAR 15 billion (US$4 billion) by the end of the year. This surge underscores tourism’s role in driving economic diversification.
Tourism-related spending reached SAR 156.6 billion (US$42 billion) by mid-2024, directly bolstering the domestic economy and supporting private sector activities.
By the end of 2024, the Kingdom aims to achieve SAR 304 billion (US$81 billion) in total tourism expenditure, emphasizing the sector’s pivotal role in its economic transformation.
These developments underscore Saudi Arabia’s sustained efforts to position itself as a global tourism hub, leveraging investments and strategic initiatives to achieve its ambitious Vision 2030 goals.
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