Doing Business in Saudi Arabia - International Franchise Association
Doing Business in Saudi Arabia - International Franchise Association
Doing Business in Saudi Arabia - International Franchise Association
Create successful ePaper yourself
Turn your PDF publications into a flip-book with our unique Google optimized e-Paper software.
Return to table of contents<br />
Chapter 5: Trade Regulations and Standards<br />
• Import Tariffs<br />
• Trade Barriers<br />
• Import Requirements and Documentation<br />
• U.S. Export Controls<br />
• Temporary Entry<br />
• Label<strong>in</strong>g and Mark<strong>in</strong>g Requirements<br />
• Prohibited and Restricted Imports<br />
• Customs Regulations and Contact Information<br />
• Standards<br />
• Trade Agreements<br />
• Web Resources<br />
Import Tariffs Return to top<br />
As a member of the Gulf Cooperation Council (GCC), <strong>Saudi</strong> <strong>Arabia</strong> applies the GCC common<br />
external tariff of 5% for most products, with a limited number of GCC-approved country-specific<br />
exceptions. <strong>Saudi</strong> <strong>Arabia</strong>’s exceptions <strong>in</strong>clude 666 products that may be imported duty-free,<br />
<strong>in</strong>clud<strong>in</strong>g aircraft and most livestock. The <strong>Saudi</strong> government also applies a 12% tariff on 294<br />
products, <strong>in</strong> some cases to protect local <strong>in</strong>dustries. Certa<strong>in</strong> textile imports are among the<br />
products on which the 12% rate applies.<br />
Be<strong>in</strong>g a WTO member, <strong>Saudi</strong> <strong>Arabia</strong> is expected to b<strong>in</strong>d its tariffs on over three-fourths of U.S.<br />
exports of <strong>in</strong>dustrial goods at an average rate of 3.2%, while tariffs on over 90% of agricultural<br />
products will be set at 15% or lower.<br />
- Import Tariffs on Food/Agricultural Products<br />
The vast majority of food products are subject to a 5% import duty. Selected processed food<br />
products, however, are assessed higher import duties. In order to protect local food processors<br />
and production from competitively priced imports, <strong>Saudi</strong> <strong>Arabia</strong> ties import duties to the level of<br />
local production of similar products. As a general rule, a maximum import tariff rate of 40% is<br />
applied when local production of a food or agricultural product exceeds a self-sufficiency level.<br />
Currently, a 40% import duty rate applies to fresh, dried and processed dates. Imports of rice,<br />
baby milk and animal feed (soybean meal, feed corn, barley, rice, sorghum, palm kernel meal,<br />
wheat bran, alfalfa hay, sugarcane molasses, rice bran, and sunflower meal, oats, canola meal,<br />
fish meal, alfalfa pellets, soy bean hulls, sunflower hulls, and rice bran) are subsidized while<br />
coffee, tea and fresh red meat enter the country duty free. <strong>Saudi</strong> <strong>Arabia</strong> has no tariff rate quota<br />
(TRQ) requirement.<br />
On March 31, 2008, the <strong>Saudi</strong> government exempted wheat, wheat flour and other gra<strong>in</strong>s from<br />
import duties and reduced duties levied on 75 other foodstuffs to 5%. The decree aims at<br />
alleviat<strong>in</strong>g the impact of the ris<strong>in</strong>g cost of liv<strong>in</strong>g <strong>in</strong> <strong>Saudi</strong> <strong>Arabia</strong>. Major foodstuffs that benefited<br />
from the reduced 5% import tariff <strong>in</strong>cluded chilled and frozen poultry and their products, eggs<br />
(fresh, dried and powdered), cheese, cheese cream, vegetable oils, pasta, canned meat, fruit