Saudi Arabia: Tobacco Imports Nearly Halved Due To Excise Tax

tobacco imports

The imports of tobacco products to Saudi Arabia dropped by 43.1 percent last year to stand at SR1.78 billion compared to the previous year apparently due to the implementation of the excise tax.

In 2017, Saudi Arabia imported cigarettes and tobacco products worth SR3.13 billion, before the decision to levy the selective tax.

According to figures released by the Saudi Customs Authority, the country imported 8,720 tons of tobacco products worth SR500 million during the first quarter of 2019.

In June 2017, the Kingdom started imposing a selective tax of 100 percent on tobacco products and energy drinks and 50 percent on fizzy drinks, the business daily Al-Eqtisadiah reported.

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Saudi Arabia became the first GCC country to levy the selective tax, followed by the UAE and Bahrain. The Gulf Co-operation Council (GCC) member states reached a decision to impose selective taxes on items deemed harmful to public health or the environment.

The value of Saudi tobacco imports consistently increased lately due to the imposition of new taxes.

Earlier this month, Minister of Labor and Social Development Ahmed Al-Rajhi issued an order effectively banning smoking in all workplaces and offices in the country.

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The decision seeks to strictly implement an existing rule that is part of the Kingdom’s anti-smoking law.

The Kingdom has previously taken several steps to curb smoking. In 2016, it started implementing rules passed under the anti-smoking law that banned smoking near mosques and educational, health, sports, cultural, social and charity institutions.

The rules also prohibited smoking outside of smoking zones in business establishments. However, this specific rule was not properly applied in the past few years.

 

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