Riyadh — King Salman on Monday issued a directive to the Saudi Arabian Monetary Authority (SAMA) to ensure that banks do not deduct any funds from the cost of living allowances and bonuses issued through a recent royal decree.
The central bank should ensure that banks do not deduct these funds for repayment of personal loans or for any other financial obligations.
King Salman last Saturday ordered a range of bonuses and payouts for citizens, including a monthly payment of SR1,000 for civil servants over the next year in compensation for rising cost of living.
In a royal decree, the King also ordered the payment of SR5,000 to military personnel serving at the front lines as well as a SR500 allowance for one year for retirees and those receiving social security.
The new payment orders were an acknowledgment of “the increased burdens for some segments of the population following from the necessary measures which the State took to restructure the economy,” according to the decree.
King Salman directed the State to bear the burden of Value Added Tax (VAT) in some situations, including special health and education services as well as the first purchase of a house that is valued at up to SR850,000. Allowances for students, retirees and social security recipients were also boosted.
Student stipends will be increased by 10 percent. The King also ordered that government salaries be paid before electricity bills are issued each month.
The package of handouts to Saudi citizens to compensate them for cost of living increases will cost the government about SR50 billion ($13.3 billion) this year, Minister of Culture and Information Awwad Al-Awwad said last Sunday.
“The allocation of SR50 billion for this decree indicates the leadership’s concern for the people’s comfort and quality of living,” he said.
Al-Awwad also repeated previous government statements indicating the government will spend SR30 billion this year on the Citizen’s Account, a household allowance scheme designed to reduce the impact of austerity policies on low and middle-income Saudi families.
He said the leadership stepped in to help citizens with basic necessities of life by announcing that the State will bear Value Added Tax (VAT) in some situations, including special health and education services as well as the first purchase of a house that is valued at up to SR850,000.
Home, health and education are among basic necessities. Awwad said SR30 billion has been deposited in Citizen’s Account to support beneficiaries.
The minister said the royal orders covered all civil and military personnel, pensioners and students. This reflects the concern of the leadership for all segments of society. It also showed special care for brave soldiers stationed at borders.
Minister of Finance Muhammad Al-Jadaan said the royal orders ensure that economic reforms being carried out by the government do not affect citizens’ daily life.
He said the royal orders are complementary to the biggest expenditure budget in the Kingdom’s history.
Source Credit: Saudi Gazette