The Tax and Customs Authority in Saudi Arabia has announced a reduction in value added tax on old vehicles.
According to Arab media, the customs authority has said that the value added tax will be levied on the profit margin instead of the total amount of the old vehicle deal. Implementation will be from July 1, 2023.
According to the authorities, the option of value added tax is being given on the basis of profit margin to reduce the value added tax on old vehicles. The authority says that the method of levying value added tax on profit margin is not mandatory. It has been authorized. Value Added Tax may be levied on the entire transaction amount.
According to the principle of profit margin, certain conditions for imposition of value added tax have been prescribed. The most important thing is that the old car is usable. It must be approved by the authority. The vehicle must be located in Saudi Arabia and have been used here. The vehicle seller should be registered with the authority as a value added tax paying party.
According to the report, one of the conditions is to have a permit for the business of used vehicles. Businesses must have permission to use the profit margin method for usable old vehicles.
