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Saudi Arabia’s Non-Oil Income Jumps By 63% As Reforms Take Effect

Saudi Arabia revealed that its non-oil income rose by 63% during the first quarter of 2018 due to its tax collection drive and other economic reforms.

The government netted close to SAR 52.3 ($14 billion) in non-oil revenues thanks to the implementation of VAT and other fees levied. Meanwhile the overall revenues rose by 15% in Q1 2018, the finance ministry said.

The Kingdom also noted that the oil revenues increased marginally by 2% to reach SAR 114 billion as the country leads OPEC and a group of other countries in maintaining production cuts in an effort to make prices competitive.

However, the expenses too have risen within the economy. Government spending rose by 18% in the first quarter this year to reach SAR 200.6 billion, compared to the same period a year ago. Saudi authorities have ramped up public spending in order to boost the economic activity within the country.

Last year, the Gulf country announced a $19 billion stimulus package to help revive growth in an economy that was battered by low oil prices and lesser government spending. The authorities said that it is aiming to help SMEs and other beleaguered firms to cope in the current conditions.

Saudi Arabia has been introducing a slew of reforms in an effort to reduce its reliance on oil. The world’s top oil exporter has imposed value added tax while it has lifted subsidies on gasoline and utilities. The cutback on such largesse has helped the economy make some periodic gains, leading to the current growth in revenues.

“This article was first posted on Forbesmiddleeast.Com. on 08 May,2018: The views expressed in this article are those of the author alone and not the Saudi-U.S. CEO Forum.”