Saudi land tax legislation in final stages

18 November 2015

Saudi Arabia has been discussing land taxes since 2014

Saudi Arabia’s Shura council has endorsed plans for a tax on undeveloped land across the country, according to local media reports.

The plans to impose a tax on unused land is aimed at encouraging development in a bid to alleviate a housing shortage in the kingdom.

Fees will be imposed as a percentage of the land value, rejecting previous plans by the cabinet to limit fees to $27 per square metre, according to local reports.

The proposed legislation will be passed to the king this week for his ratification, and the cabinet will set the date of implementation.

The housing ministry says the policy targets unused, privately owned land across the country that can be better used to solve the housing problem. The government has been looking to take several measures to encourage housing developments. In September The Jeddah Muncipality released 3 million square metres of land from illegal occupants in the south of the city

According to government statistics, there are currently 750,000 families eligible for public housing. Despite a $67bn plan in 2011 to build 500,000 homes over several years, Saudi Arabia’s poorer citizens have suffered from rising rental prices in cities such as Riyadh and Jeddah.

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