Yesterday, April 15th, came and went without any fanfare here in Saudi Arabia. There were no outrageously long lines at the post offices, no people griping about getting all those complicated forms filled out to file their taxes. Taxes are virtually non-existent here in Saudi Arabia. There are no property taxes, no capital gains taxes, and even at the grocery store, you pay exactly what an item's price says and not a Riyal more. You don't have to make sure you have that extra additional cash in your wallet to cover the usual 5-8% of sales taxes.
The Kingdom of Saudi Arabia holds twenty five per cent of the world's oil reserves, and most of its fiscal operating budget capital comes from these profits. Individual workers here pay absolutely no income tax - period. Ex-pat workers from the US must still pay their US taxes, however generally speaking in most cases, the first $80,000 of income or so earned outside of the country is tax exempt. Foreign ex-pat workers are also given an automatic filing date extension of an additional two more months to get their paperwork submitted. However since each person's situation is different and tax requirements and payments can vary and I am no tax expert, please refer to the IRS website to determine what taxes you may owe if you are an ex-pat worker in Saudi Arabia or any other country.
One thing that Saudi Arabia does have is something called Zakat, which is a religious tithing of sorts, and alms for the poor, if you will. It is actually one of the five basic pillars of Islam - to give a small percentage (2.5%) of 15% of your profits (it's not based on your gross income) each year to those less fortunate. This is a flat-rate and is not based on any type of sliding scale and there are no loop-holes. Zakat makes up the majority of the income each year that Saudi Arabia receives that is not oil-based. There is also another form of Zakat that Muslims are encouraged to pay during the month of Ramadan, when Muslims fast during the daylight hours, among other things, to gain a better appreciation for those who don't have enough to eat. This Zakat ul-Fitr is given in the form of food.I recently did a post listing many food prices here in the Kingdom so you can compare with your area. Here's the link in case you missed it. It's actually a nice feeling paying exactly what the sticker price says and not having to try to figure out how much more in taxes you will have to pay!
