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June 26, 2026

Excise Tax Expansion

Transitional Excise Rules

June 2019

Contents

1. Introduction

  1. 1.1. Implementing an Excise Tax Regime in The Kingdom of Saudi Arabia

  2. 1.2. The Zakat, Tax and Customs Authority

  3. 1.3. What is Excise Tax

    1. 1.3.1. Excise Tax expansion

  4. 1.4. This Guide

2. Definitions of the main terms used

3. Determining the amount of Excise Tax due

  1. 3.1. Goods subject to Excise Tax

  2. 3.2. Tax rates

  3. 3.3. Tax base

4. Excise Tax due under a Transitional Phase

  1. 4.1. All Excise goods present in the Kingdom

  2. 4.2. Date of entry into force or amendment of legislation or a decision

  3. 4.3. Situations leading to a Transitional Phase being applicable

  4. 4.4. Suspension arrangement

  5. 4.5. Government entity

  6. 4.6. Commercial purposes

  7. 4.7. Exception on Excise goods specified for commercial purposes

5. Disclosure and payment of Excise Tax due

  1. 5.1. Holder of Excise goods

  2. 5.2. Disclosure and Payment

  3. 5.3. Producers of goods becoming subject to Excise Tax

  4. 5.4. Violation of Excise legislation

The Zakat, Tax and Customs Authority ('ZATCA', 'Authority') has issued this Guide for the purpose of clarifying certain tax treatments concerning the implementation of the statutory provisions in force as of the Guide's issue date. The content of this Guide shall not be considered as an amendment to any of the provisions of the Laws and Regulations applicable in the Kingdom.

Furthermore, the Authority would like to highlight that the clarifications and indicative tax treatments prescribed in this Guide, where applicable, shall be implemented by the Authority in light of the relevant statutory texts. Where any Clarification, interpretation or content provided in this Guide is modified - in relation to unchanged statutory text - the updated indicative tax treatment shall then be applicable prospectively, in respect of transactions made after the publication date of the updated version of the Guide on the Authority's website.

Introduction

Implementing an Excise Tax Regime in The Kingdom of Saudi Arabia

The Kingdom of Saudi Arabia ratified the Common Excise Tax Agreement of the Gulf Cooperation Council (GCC) States, by Royal Decree No. M/51 dated 5/3/1438 (the Agreement'). Pursuant to the provisions of the Agreement, the Kingdom of Saudi Arabia ('Kingdom') issued the Excise Tax Law under Royal Decree No.(M/86) dated 27/8/1438 AH ('Excise Tax Law'), as well as the Implementing Regulations of the Excise Tax Law under decision of the Board of Directors of the Zakat, Tax and Customs Authority (''ZATCA') No. (9-1-17) dated 5/9/1438 ('Implementing Regulations').