The Court of Grievances will be the final decision maker in any dispute between the Zakat payer and the Zakat and Income Tax Department over matters of assessment involving this Islamic obligation, an official has said.
“The new Zakat regulation, which has reached its final stage prior to implementation, has been prepared after studies of expert committees and on the basis of relevant fatwas, ministerial decisions and royal decrees,” said Ibrahim Al-Mufleh, director general of the department.
The new regulation also empowers the department to summon any defaulter of Zakat payment in addition to banning a defaulter from traveling outside the Kingdom, he said.
Al-Mufleh added that the Kingdom started implementing the Shariah-based collection of Zakat during the reign of King Abdul Aziz. He also said the Kingdom’s tax system is the seventh among most advanced tax systems in the world.
He said Zakat revenue crossed SR10 billion while revenue from income tax imposed on foreign companies operating in the Kingdom reached SR9 billion in 2011.
He also pointed out the difference in the assessment of tax for foreign investors and calculation of Zakat.
While the tax is assessed at 20 percent of the profits of investments, Zakat is calculated at 2.5 percent of total assets.
The Zakat is utilized for the welfare of the poor through the government’s social security schemes.
The department plans to update all data about Zakat payers with the aim of ending attempts to evade the obligation. The defaulters of Zakat will sternly be dealt with as those who evade debt repayments.
The department's studies discovered that a quarter of people evaded Zakat payments last year.
New regulations in the pipeline focus on taking various steps to enforce collection of Zakat. One step is to contact via telephone a Zakat payer to remind him about the obligatory payment.
A Zakat payer will also be directed to go to the department's office with all relevant documents detailing his assets and income, including an updated business license. The department will also make independent inquiries to discover if a Zakat payer is concealing any facts about his income.
These steps will be implemented in major cities and later extended to other towns in the Kingdom.
Saudi Zakat regulations cover Saudi individuals, companies and nationals of the Gulf Cooperation Council states who conduct business in the Kingdom apart from stakes of Saudis and GCC citizens in joint stock companies.
(ArabNews.Com, 10 March2012)
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