MoU between GAZT and “ESAL” to facilitate e-invoicing in KSA
Riyadh, July 2, 2018:
The General Authority for Zakat and Tax (GAZT) and the Saudi Arabian Monetary Agency (SAMA) – represented by the “ESAL” e-platform - signed a Memorandum of Understanding (MoU) to encourage companies and government entities to implement e-invoicing through the e-platform, with the aim of enhancing transparency in business invoices as well as reducing tax evasion cases.
VAT guidelines not only require a certain level of transparency in business transactions, but also mandate the collection, exchange, and keeping of invoices for the purpose of filing tax returns. Using the “ESAL” e-platform allows government agencies and companies to greatly reduce the significant time, effort and money invested in complying with GAZT’s regulatory requirements, as well as enhance the level of transparency and streamline procedures.
With the Governor of GAZT Eng. Suhail bin Mohammed Abanmi present, the MoU was formally signed by Mohammed Al-Haidian, Director of the Information Technology Department at GAZT and Ziad Al Yousif, Director of the Payment Systems Department at SAMA.
Al-Hadian noted that this new partnership with "ESAL" will enable GAZT to get detailed information about the invoicing transactions in Saudi Arabia through the e-platform, further enhancing transparency and efficiency of payment settlement procedures and limiting reliance on paper invoices issued by companies.
"SAMA’s “ESAL” platform will also allow GAZT to monitor e-invoices issued by VAT-registered businesses to ensure collection of the VAT amounts due and reduce tax evasion cases," he said.
For his part, Ziad Al Yousuf, DIrector of Payment Systems at SAMA which operates the – along with “ESAL” – the “MADA” and “SADAD” national payment systems, said that "ESAL" contributes to reducing costs associated with managing transactions and invoices, improving work efficiency and enhancing business environments by streamlining procedures for issuing, tracking and paying invoices between companies.
Moreover, the platform aims to improve the collection process, provide clearer information on billing situations, increase the efficiency of settlement processes and reduce the need for collection of paper money and invoices from corporate and government entities.
Al Yousuf went on to express his delight with this new cooperation with GAZT, as the “ESAL” platform is a key factor in achieving the objectives of Saudi Arabia’s Vision 2030 in terms of digital transformation, including moving towards digital financial transactions as outlined in the financial sector development program.
The Saudi Arabian Monetary Agency (SAMA) launched the "ESAL" platform last May to facilitate the payment mechanism between government agencies and the business sectors and suppliers who deal with them.