In a move to attract foreign investment and bolster its position as a regional business hub, Saudi Arabia has announced a 30-year tax break for companies that relocate their regional headquarters to Riyadh. The incentive package, which includes a zero percent corporate income tax rate, is aimed at encouraging multinational corporations to establish a strong presence in the Saudi capital.
The leading oil exporter in the world declared in February 2021 that, by January 1, 2024, it will no longer be giving government contracts to businesses whose regional headquarters are not in the kingdom.
“This is a significant step in our efforts to make Saudi Arabia a more attractive destination for foreign investment,” said Saudi Arabia’s Minister of Investment Khalid Al-Falih.
Saudi Finance Minister Mohammed Al-Jadaan said “The new tax exemptions granted on regional headquarters activities will give international companies in the kingdom more clarity of vision and stability”.
In addition to the tax break, the Saudi government is also offering a range of other incentives to attract companies to Riyadh. These include subsidized land, access to government procurement contracts, and support for training and development programs.
The tax break for regional headquarters is expected to further boost FDI inflows to Saudi Arabia and help the kingdom achieve its goal of becoming a leading regional business hub.
