A privately owned, vacant plot of urban land measuring 8,000 square metres, zoned for residential use, sits within city boundaries covered by Saudi Arabia's White Land Tax regime. Under the White Land Fees Implementing Regulations as amended in 2025, how is the annual White Land Tax rate on this plot generally determined?
- A single flat rate of 2.5% of the land's assessed value applies uniformly to every qualifying vacant plot nationwide, unchanged since the tax was first introduced
- The rate is fixed at 10% for every plot exceeding 5,000 square metres, with smaller qualifying plots exempt entirely
- The rate is set on a tiered scale from 2.5% up to 10% of the land's value, depending on the development priority tier assigned to that plot by the competent authority, rather than a single uniform percentage
- The rate depends solely on how long the owner has held the land, rising by a fixed percentage for every additional year it remains undeveloped, irrespective of location or development priority
Why C? And why not the others?
Correct answer: C. The rate is set on a tiered scale from 2.5% up to 10% of the land's value, depending on the development priority tier assigned to that plot by the competent authority, rather than a single uniform percentage
Under the 2025-amended White Land Fees Implementing Regulations, a qualifying vacant urban plot (a landholding of 5,000 square metres or more under common ownership, zoned for residential or commercial use) is no longer subject to a single flat rate; instead, the annual fee is set on a tiered scale, from 2.5% up to 10% of the land's value, with the applicable tier determined by the development priority the competent authority assigns to that specific plot based on factors such as location and infrastructure readiness. The option describing an unchanged flat 2.5% rate is wrong because that was the original, now-superseded regime; the 2025 amendment introduced the tiered structure precisely because a single flat rate no longer applies. The option claiming a flat 10% for every plot over 5,000 square metres, with smaller plots exempt, gets the area threshold roughly right but wrongly assumes every qualifying plot sits in the highest tier, when the assigned tier, not just size, drives the rate. The option tying the rate purely to how many years the land has sat undeveloped is wrong because the regulations key the rate to the assigned development priority tier, not to a simple holding-period counter.
Source: White Land Fees Implementing Regulations, amendments effective following publication in the Official Gazette, 22 August 2025