Saudi Arabia's economic reforms, including VAT and higher energy prices, have started to yield results, but more needs to be done to plug a chronic budget deficit, the IMF said Monday.
After a crash in oil prices that shrank Saudi Arabia's revenues and led to budget shortfalls for five years in a row, the world's largest crude exporter imposed a raft of measures to diversify its economy.
"Reforms have started to yield results and... the outlook for the economy is positive," the International Monetary Fund said in a regular report.
But it said the kingdom, where oil income still accounts for 70 percent of public revenues, must extend adjustments in the price of utilities and fees levied on expatriates.
It also called on Saudi authorities to consider doubling value added tax (VAT) from five percent to 10 percent.
Saudi Arabia introduced the tax in 2018, a year in which its returns amounted to $12.5 billion or 1.6 percent of gross domestic product.
Commitment to the reform programme will be key to success in "promoting non-oil growth, creating jobs for nationals, and achieving the objectives of the authorities' Vision 2030 agenda", the IMF said.
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