Saudi Arabia: 30-year Corporate and Withholding Tax Exemption Under RHQ Program

The Ministry of Investment of Saudi Arabia has announced that businesses that set up a regional headquarters in Saudi Arabia will be eligible for a 30-year exemption from all corporate income and withholding taxes that arise in relation to approved Regional Headquarters’ (RHQ) business activities as issued on their license. These incentives will apply from the beginning of the RHQ program when it goes into effect on January 1, 2024. The program was originally announced by the Saudi government in February 2021 and is part of ongoing efforts to attract foreign investment and enhance the country’s business landscape. As part of this program, Saudi authorities will significantly reduce their contractual arrangements with those foreign companies that do not have regional headquarters in Saudi Arabia. Only limited exemptions will apply. To date, Saudi Arabia has issued licenses to over 200 companies under the RHQ program.