2020 Performance: The budgeted deficit for 2020 is estimated to reach SAR298 ($79.5 billion) or 12 percent of GDP compared to SAR133 billion ($35.5 billion) or 4.5 percent of GDP in 2019. Total revenues declined to an estimated SAR770 billion ($205 billion), marking a 17 percent drop compared to 2019, which saw SAR927 billion ($247 billion) in total revenues. The government enacted a number of initiatives to combat the reduction in revenues by increasing the VAT rate from 5 percent to 15 percent in July while keeping the VAT rate at 5 percent for real estate transactions to stimulate demand. Total government expenditures in 2020 are expected to reach SAR1,068 billion ($285 billion) compared to 2019, which reached SAR1,059 billion ($282 billion) representing a marginal 0.8 percent increase.
2021 Budget: The budget deficit in 2021 is expected to be reduced to reach SAR141 billion ($38 billion), equivalent to 4.9 percent of GDP, declining by 7.1 percent of GDP compared to the estimated deficit for 2020. The decline in the deficit is attributed to a 10 percent increase in total revenues in 2021 as the government forecasts SAR849 billion ($226 billion) in revenues versus SAR770 billion ($205 billion) for 2020. Total expenditures are expected to decrease by 7 percent in 2021 compared to 2020. Total expenditures are expected to fall from SAR1,068 billion ($285 billion) in 2020 to SAR990 billion ($264 billion) in 2021.
