Tax Evasion is Considered a Criminal Offense in All Its Forms under International Laws Without Exception.
There are many different forms of tax evasion, each subject to clear penalties explicitly stated in Saudi tax regulations, such as the Income Tax Law, the Value-Added Tax (VAT) Law, and the Executive Regulations of the Real Estate Transaction Tax. This can be detailed as follows:

First: Definition of Tax Evasion:

Tax evasion is the attempt by a taxpayer to avoid paying taxes to the authority. It is an illegal act that exposes the offender to fines and may even lead to imprisonment in some cases.

Second: Tax Evasion under the Value-Added Tax (VAT) Law:

• Submitting incorrect, forged, or fabricated documents, declarations, records, or information with the intent to evade paying the due tax, reduce its value, or reclaim it unlawfully. The burden of proof lies on the taxpayer to demonstrate the absence of intent.
  Penalty: A fine of not less than the due tax amount and not exceeding three times the value of the goods or services involved in the evasion.
• Importing or attempting to import goods or services into the Kingdom, or exporting or attempting to export them out, in violation of applicable laws, without full or partial payment of tax, or in violation of prohibitions and restrictions in this law or any other law.
  Penalty: A fine not less than the due tax amount and not exceeding three times the value of the goods or services involved.
• Failure to submit a registration application within the prescribed deadlines.
  Penalty: A fine of 10,000 Saudi Riyals.
• Submitting an incorrect tax return, modifying a submitted tax return, or submitting any document that results in under-calculating the tax due.
  Penalty: A fine equal to 50% of the difference between the calculated tax and the due tax.
• Failure to submit the tax return within the specified period.
  Penalty: A fine of no less than 5% and no more than 25% of the tax amount that should have been declared.
• Failure to pay the due tax within the specified period.
  Penalty: A fine equal to 5% of the unpaid tax for each month or part thereof that the tax remains unpaid.
• Issuing a tax invoice without being registered.
  Penalty: A fine not exceeding 100,000 Saudi Riyals, without prejudice to any harsher penalty provided by any other law.
• Failure to keep tax invoices, books, records, and accounting documents for the prescribed period, with fines applied for each tax period.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• Preventing or obstructing authority employees or any of their workers from performing their duties.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• Violating any other provision of the VAT law or its regulations.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• In the case of repeated violations of the same offense within three years of the previous penalty decision, the fine may be doubled.

Third: Tax Evasion under the Excise Tax Law:

• Engaging in any of the following activities without registration is considered tax evasion:
  • Importing excise goods.
  • Producing excise goods.
  • Possessing excise goods under tax suspension status.
  Penalty: A fine of no less than the due tax and not exceeding three times the value of the excise goods involved.
• Failure to pay the due excise tax within the specified period.
  Penalty: A fine equal to 5% of the unpaid tax for each month or part thereof.
• Failure to submit a tax return to the authority for the specified tax period.
  Penalty: A fine of no less than 5% and no more than 25% of the tax amount that should have been declared.
• Preventing or obstructing authority employees from performing their duties.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• Failure to provide requested information to the authority.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• Violating any other provision of the excise tax law or its regulations.
  Penalty: A fine not exceeding 50,000 Saudi Riyals.
• Repeated violations of the same offense within three years may lead to doubling the fine or suspension of the license for up to six months.

Fourth: Tax Evasion under the Executive Regulations of the Real Estate Transaction Tax:

• Failure to pay the due tax within the specified period.
  Penalty: Equal to 50% of the unpaid tax for each month or part thereof, with the Minister of Finance authorized to reduce or exempt this penalty according to specified controls.
• Providing incorrect data about the value of the real estate transaction resulting in partial or full non-payment of the tax due.
  Penalty: A fine not less than the due tax and not exceeding three times its amount.
• Using any trick, arrangement, or method, regardless of its type or nature, resulting in partial or full non-payment of the due tax.
  Penalty: A fine not less than the due tax and not exceeding three times its amount.
• Any other act resulting in partial or full non-payment of the due tax.
  Penalty: A fine not less than the due tax and not exceeding three times its amount.
• Anyone assisting or collaborating with the offender in evading tax payment.
  Penalty: A fine not less than the due tax and not exceeding three times its amount.

Fifth: Tax Evasion under the Income Tax Law:

• Failure by the taxpayer to pay the due tax on the specified dates.
  Penalty: The Zakat, Tax and Customs Authority may seize movable and immovable property legally allowed to be seized and proceed with seizure procedures after twenty days from notifying the taxpayer.
• Failure to register the activity with the authority before the end of the first fiscal year.
  Penalty: A fine not less than 1,000 Saudi Riyals and not more than 10,000 Saudi Riyals.
• Providing false information or fraud by the taxpayer or their legal accountant with the intent to evade tax.
  Penalty: A fine equal to 25% of the tax difference.

For more information about tax laws and penalties, please feel free to contact us.