As a part of its Vision 2030, Saudi Arabia has divided itself into Free Zones to transform its economy for private sector growth. This has enabled many foreign investors to do business here in Saudi Arabia. To benefit from the leverage of Free Zone Business setup in Saudi Arabia, it’s necessary to understand the regulatory intricacies of the country.
Industries Thriving in Free Zones
Out of the newly formed five Special Economic Zones (SEZ’s), the west free zone, also called King Abdullah Economic City, is positioned along the Red Sea. It provides four industrial sectors to be developed: automobiles, consumer goods, electronic light manufacturing, pharmaceuticals, Medtech, and logistics.
The North-east free zone, termed Ras Al Khair, has established maritime industries to grow and become a key player in the country’s overall development. The various sectors focused are shipbuilding and MRO, rig platforms, and MRO.
The Southwest Free Zone, titled Jazan, focuses on the mining industry for global construction, processed metals, and mineral markets. Special sectors included are Food processing, metal conversion and logistics.
Central Cloud Computing in King Abdulla Aziz City for Science & Technology free zone has the ability for businesses to build and operate data centers from all centers across the country. This sector focuses on Cloud Computing Services.
Central Special Integrated Logistics Zone aims to make the capital city, Riyadh, one of the top urban powerhouses in the global economy. This zone focuses on consumer products, computer parts, pharmaceuticals, nutritional and medical supplies, aerospace spare parts, luxury goods, jewelry, and precious metals.
Top Reasons to Choose Free Zone Business Setup in Saudi Arabia
Free zone business setup in Saudi Arabia opens a new era of job opportunities for investments. Special free zones for foreign investors provide for exemptions within the zones to attract FDI. The major incentives permitted include:
- 5% corporate income tax (CIT) for up to 20 years
- 0% unlimited withholding tax for the repatriation of profits from an SEZ to foreign
- countries
- 0% customs duties deferral for goods and equipment made inside the SEZ (for Jazan – only on capital equipment and inputs)
- 0% VAT on goods exchanged within an SEZ and between SEZs
- Expat levy exemptions for employees and their families
- Tax treatment under OECD principles to avoid double taxation.
The world-class infrastructure within the SEZs makes them an ideal choice for companies wanting straightforward setup requirements and streamlined administrative processes. SEZs also make available ample opportunities for business growth and expansion.
SEZs host regular networking events and conferences, bringing together industry leaders, investors and government officials. These platforms allow companies to build valuable partnerships and share knowledge and know-how.
Advantages of Setting Up a Business in Saudi Free Zones
A few benefits of free zone business setups in Saudi Arabia are as follows:
- Reduced corporate tax rate
- Zero withholding tax
- Customs duty exemption
Business formation in Saudi Free Zones is an excellent choice for foreign investors because of the following:
- Robust economy
- Supportive Government
- Growing Start-up ecosystem
- Skilled workforce
Saudi Free Zone offers stability, security, ease of doing business, and a bright outlook for your business setup. A few indicators that can help you establish a successful business in free zones of Saudi Arabia are:
- Be a part of the region’s first end-to-end EV cluster.
- Use of the opportunity to focus on end-to-end maritime value chains.
- Take advantage of the region’s food security agenda for enhancing production in the country.
- Expand the cloud computing sector across Saudi Arabia.
- Set up your business in Saudi Arabia’s own Silicon Valley, the nerve center of emerging digital technologies.
- Transform the future of health care through MedTech innovations and devices.
- Make efforts to be in the forefront of the global ship building and repair industry.
- Capitalize on Saudi Arabia’s position in the field of mining and metal supply chains.
- Take advantage of the expanding regional hub for logistics.
Helpline Group Assists Entrepreneurs in Saudi Free Zone Business Setup
Unlock a new route to global markets with Saudi Arabia’s Special Economic Zones with Helpline Group. Our 300+ experts across 10 branches and 25 years of global experience will help you establish a successful business venture in Saudi Arabia.
