The Shura Council of Saudi Arabia announced the approval of the Gulf Cooperation Council (GCC) Value Added Tax (VAT) Framework Agreement on 30 January 2017. The regime is expected to be applicable from 1 January 2018 and as specified in the GCC agreement 5% levy will be applied to selected goods.

The GCC countries have come to an agreement to apply selective excise taxes on tobacco items and also to sugar sweetened beverages including soft drinks and energy drinks which are expected to be introduced in the second quarter of 2017. According to the agreement there will be 50% excise levies on soft drinks and a 100% tax on cigarettes and energy drinks.