Now do this put-the-text-back-together activity.
This is the text (if you need help).
Saudi Arabia is going to triple the rate of the value added tax (VAT) it imposes on goods and services. VAT will increase from 5 per cent to 15 per cent on the 1st of July. The tax was introduced in Saudi Arabia for the first time in 2018. Government authorities say this drastic measure is necessary to curb the effects of the coronavirus pandemic on the economy. The cut is also part of wider austerity measures to help the economy. Finances of the oil-rich nation have been badly hit as the pandemic has seen oil prices and demand for oil plummet. Analysts are reporting that oil revenues this year have fallen by almost a quarter when compared to the same period last year.
Another measure the finance ministry has taken in a bid to shore up the economy is the suspension of a cost of living allowance. This is a payment of about $256 per month to state employees. It was introduced to help offset rising prices and more expensive petrol at the pump. Saudi's Finance Minister said: "These measures are painful but necessary to maintain financial and economic stability over the medium to long term...and to overcome the unprecedented coronavirus crisis with the least damage possible." A Gulf expert said: "The move will impact consumption and could also lower the expected revenues. These are pro-austerity and pro-revenue moves rather than pro-growth ones."
Comprehension questions- By how many times will Saudi Arabia's value added tax increase?
- When was value added tax introduced in Saudi Arabia?
- What did the government say the tax was necessary to curb?
- How have Saudi Arabia's finances been hit by the coronavirus pandemic?
- By how much have oil revenues fallen since last year?
- How much is Saudi Arabia's cost of living allowance?
- What was the cost of living allowance introduced to offset?
- Over what timeframe does Saudi want to maintain financial security?
- Who said consumption would be impacted by the move?
- What did an expert say the moves would not promote?
Back to the VAT lesson.
