Economics
Saudi Arabia's Safety-Net Spending Wipes Out New Tax Gains
- Surge in spending on wages, social benefits as capex declines
- Saudi Arabia is trying to ease its addiction to oil sales
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Saudi Arabia’s efforts to ease the burden on ordinary citizens from its promised economic overhaul are taking a toll on its balance sheet.
The increase in the kingdom’s spending on wages and social benefits during the first quarter exceeded what it accrued through higher taxes and lower subsidies, helping to drive the deficit higher to 34.3 billion riyals ($9.2 billion), from 26.2 billion riyals a year ago, according to a quarterly Finance Ministry report.