Saudi Arabia to Give Bonus Payouts to Citizens

By Edward Leano, Christian Post Contributor Tuesday, January 09, 2018

It's a good time to be a Saudi Arabian state employee, as many of them will be getting a payout via a decree from King Salman bin Abdulaziz Al Saud. This handout, to be given in the form of monthly payments, are meant to offset the increased costs of living in the country.

The bonus is not only confined to state employees, which number about 1.18 million citizens, according to Reuters. Pensioners, which number to about 1.23 million, as well as serving military personnel are also covered by decreed bonuses.

These handouts, which will come in the form of 1,000 riyals or about $267 paid monthly over the year, will be King Salman's way of reducing the burden of domestic gas price hikes and a new value-added tax to state employees.

Military personnel serving on the front lines facing Yemen, which Saudi Arabia is currently embroiled in a three-year conflict with, will also get 5,000 riyals or about $1,333 as well.

When these payouts come into effect, they could help offset some of the price hikes that the Kingdom established to help alleviate its budget deficit. The new value-added tax added 5 percent to the price of basic goods, while the cost of gasoline has nearly doubled, according to Business Insider.

"The allocation of 50 billion riyals for this decree indicates the leadership's concern for the people's comfort and quality of living," Awwad bin Saleh Alawwad, the Minister of Culture and Information, explained to the local press.

Analysts and private economists estimate that the government could expect to raise 40 billion riyals this year from the new tax, while the gasoline price hike may add tens of billions more, according to an earlier statement by government officials.

Whether these measures will be enough to compensate for the state budget plan released last month, which will run the country into a deficit, remains to be seen. The plan in its current state is projected to run a deficit of 195 billion riyals, about 7.3 percent of the country's gross domestic product, according to Reuters.