Saudi cabinet approves tax on vacant land
Move will make it more expensive to keep urban plots undeveloped, in bid to address housing shortage
Saudi Arabia’s cabinet has approved details of a tax on owners of vacant land in urban areas, as part of an attempt to address the kingdom’s housing shortage.
Fees on undeveloped lands will be introduced in stages, according to a statement by the state news agency SPA.
It will first be applied to undeveloped land with an area of 10,000 square metres and more, and later apply to plots of more than 5,000 square metres.
“The Ministry of Housing shall collect the applied fees in this regard as well as the fines imposed for violation of the rules or regulations, and take the necessary measures to prevent evasion of the payment of these fees and fines,” SPA reported.
The Saudi housing ministry in May outlined the rules of the upcoming annual tax, saying via Twitter that the rate has been set at 2.5% of the value of land held by individuals or non-government entities.
Analysts estimate that 40-50% of land inside major cities remains vacant, which has caused a lack of affordable housing, especially for young Saudis.
