Saudi Arabia has been forced to take drastic action to shore up government finances in response to the economic tsunami unleashed by the coronavirus pandemic.

Having only first introduced VAT barely two years ago, the government has now announced that the rate will be tripled to 15% from 1 July, and that it is also removing a SR1,000 ($267) monthly living allowance for Saudi citizens from 1 June. VAT was only introduced for the first time in January 2018 and already accounts for a sizeable share of government revenues. (CONTINUED - 1361 WORDS)