RIYADH — A working group with the Foreign Trade Authority (FTA) has been formed to deal with the impact of an increase in Value Added Tax (VAT) on industrial entities, Minister of Industry and Mineral Resources Badr Al-Khorayef said on Thursday. He said that the increase in VAT will create a problem while importing goods from the Gulf markets due to the difference in the VAT rate. Therefore, a proactive action is required by studying international practices before its implementation. During a webinar entitled "Initiatives – Challenges" organized by the Eastern Province Chamber via video conferencing on Thursday evening, Al-Khorayef said that the Ministry is constantly working to evaluate and address all the challenges facing the industrial sector in various parts of the Kingdom. He added that that the coronavirus (COVID-19) crisis has given the industrial sector several gains, including the need for industries to meet their needs in the health, medical and food domains. He asserted that the national industries have proved to be highly efficient during the crisis, most significant of which is their reliable and excellent supplies. Al-Khorayef said that the coronavirus crisis will usher in radical changes in various concepts of global trade, reshaping the world economy radically, which will be positively reflected on the development of local industries in general. He stressed that the Kingdom is one of the best countries in the world in managing this crisis under the directions of Custodian of the Two Holy Mosques King Salman and Crown Prince Muhammad Bin Salman. He disclosed that there are plans to assign the Saudi Industrial Development Fund (SIDF) to monitor and quickly feel the pulse of industries most impacted by the current conditions and are on the verge of bankruptcy or exit from the market. The objective is to provide them with assistance. The minister pointed out that mergers and acquisitions are among the options offered to factories. He disclosed that the ministry is studying stopping the export of waste paper and recyclable cartons so as to protect the national industries amid the COVID-19 pandemic. The Ministry of Industry is working in cooperation with the National Waste Management Center to study the feasibility of recycling of paper and other products with the objective of increasing their value economically and work on proposals and suggestions for drafting policies and legislations to stop the export, the minister stressed. He added that the ministry is ready to study exempting factories under construction from payment of privatization fees during the current period. The minister drew attention to the fact that the ministry had launched an initiative earlier to postpone the installments for these factories for a period of six months.
