Goods exempt from value-added tax are those upon which the tax is not levied, and the associated input tax is not deductible.
Value-added tax
Value-added tax is an indirect tax imposed on all goods and services bought and sold by businesses, with some exceptions. These exceptions include tax-exempt goods and services, goods and services subject to a zero-rated tax, goods and services with value-added tax incurred by the state, and goods and services outside the scope of the tax.
Goods and services exempt from value-added tax
- Sale of commercial and residential real estate.
- Sale of used residential real estate.
- Lease of residential real estate.
- Financial products based on profit margins.
- Operating current accounts, deposits, and savings.
- Life insurance and reinsurance services.
- Interest or lending fees charged with an implicit profit margin on any form of lending, including credit cards.
- The interest or lending fees charged with an implicit profit margin on financing, including lease financing.
- Issuing or transferring debt security and bonds.
- Life insurance.
- Personal protection insurance.
- Personal protection and saving insurance.
- Other personal protection and saving insurance.
- Group protection insurance.
- Group protection and saving insurance.
- Other group protection and saving insurance.
Zero-rated goods and services
- Transportation services for goods and passengers within Saudi Arabia and related transportation services.
- Qualified international transportation means (vehicle, vessel, aircraft) with specific specifications.
- Spare parts, consumables, and maintenance and repair services specific to qualified transportation means (under special conditions).
- International transportation.
- List of qualified medicines and medical supplies.
- Supply of investment metals (gold, silver, and platinum) if their purity level is not less than 99 percent and they are tradable on the global bullion market.
- Exporting goods outside the countries of the Gulf Cooperation Council (GCC).
- Services provided to non-GCC residents and enjoyed and utilized outside the GCC countries.
Goods and services with value-added tax incurred by the state
- Citizens benefiting from private education services.
- Citizens benefiting from private healthcare services.
Goods and services outside the scope of the tax
- Public education.
- Healthcare services in public health centers.
- Public services provided by government entities and not intended for economic activity, such as renewal of passport and driver's license, etc.
- The activity performed by employees insofar as they are bound to an employer by contract (salaries of employees affiliated with the employer).
- Supplies made between members of one tax group.
- Insurance for properties located outside Saudi Arabia.
- Engineering insurance - insurance for sites located outside Saudi Arabia.
- Sale of goods on behalf of or in the name of the policyholder.
- Settlement of cash claims for the insured under the insurance policy.
- Replacement of insured goods under the insurance policy.
- Performance of repairs or other services as the primary supplier on behalf of the insured under the policy.
- Receipt of payments from reinsurance agreements.
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