- Saudi Arabia issued Bylaws on January 16, 2026, establishing the legal, regulatory, and tax framework for entities in four Special Economic Zones (SEZs): Jazan, Ras Al Khair, King Abdullah Economic City (KAEC), and the SEZ for Cloud Computing and IT.
- All SEZ entities must be limited liability companies of Saudi nationality, with their principal place of business within the relevant SEZ.
- Jazan, KAEC, and Ras Al Khair SEZs offer a reduced 5% Corporate Income Tax (CIT) rate for 20 years, exemption from Withholding Tax, and are not subject to the Zakat regime; the Cloud Computing and IT SEZ offers a bespoke tax framework aligned with OECD principles.
- VAT on goods supplied to or between SEZ entities is zero-rated under certain conditions, and customs duties are suspended for goods under a customs suspension regime; services remain subject to standard VAT rules.
- The Cloud Computing and IT SEZ also provides non-tax incentives such as affordable network connectivity and low electricity prices.
Source: mailchi.mp
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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