If you are involved in manufacturing, assembly, or packaging as part of your manufacturing business setup in Saudi Arabia, you might be throwing money away.
On December 17, 2025, the Saudi Cabinet, chaired by His Royal Highness Crown Prince Mohammed bin Salman, issued a landmark decision that fundamentally alters the operational landscape in the Kingdom. The government has permanently revoked the expatriate workforce levy (financial consideration) for all companies holding a valid Industrial License.
This is not another temporary extension. It is a permanent strategic shift designed to reward local production. If you are operating under a commercial license, the gap between your costs and your competitors just got significantly wider.
From "Waiver" to "Permanent Cancellation": What Changed?
For the past six years, the industrial sector benefited from a temporary waiver of expat fees. However, this waiver was set to expire on December 31, 2025, leaving many business owners hesitant to commit to the long-term requirements of an Industrial License due to fear of the fees returning.
The new Cabinet decision removes that uncertainty entirely. By permanently scrapping the levy, the Ministry of Industry and Mineral Resources (MIM) has turned the Industrial License into the ultimate tool for long-term cost containment.
Key Stat: Since the original waiver was introduced in 2019, the number of industrial facilities in Saudi Arabia has jumped from 8,822 to over 12,000, proving that cost relief drives growth.
To understand how this growth aligns with broader manufacturing trends, read our detailed analysis on Saudi Arabia’s industrial growth fueled by manufacturing.
The Financial Impact on Your Business
Why should you care? Because the cost difference between a Commercial License and an Industrial License is now massive.
| Feature | Commercial License | Industrial License |
|---|---|---|
| Expat Levy Status | Payable (Monthly per employee) | Permanently Exempt |
| Customs Duty | Standard rates on imports | Exempt on raw materials/machinery |
| Energy Rates | Commercial rates | Subsidized industrial rates |
| Land Access | Commercial lease rates | Priority access to MODON/RCJY land |
If you have 50 expat employees, staying on a commercial license could cost you hundreds of thousands of Riyals annually in levies that Industrial License holders simply do not pay.
Are You Eligible for an Industrial License?
Many businesses operate in a “grey area.” You might be performing light manufacturing, packaging, assembly, or food processing under a general trading license.
If your operations involve transforming raw materials, assembling components, or significant value addition, you likely qualify for an Industrial License. Continuing with the wrong license means you are voluntarily paying fees that your competitors have eliminated.
How We Can Help You Transition
Obtaining an Industrial License involves a technical process with the Ministry of Investment (MISA) and the Ministry of Industry and Mineral Resources (MIM), often requiring feasibility studies and environmental compliance.
We specialize in navigating this complex landscape. We help you:
- Assess Eligibility: We review your current activities to confirm if they qualify as “industrial.”
- Manage the Application: We handle the technical and financial documentation required by MIM.
- Unlock the Savings: We guide you through the process of updating your workforce status to activate the fee exemption immediately.
Ready to Stop Overpaying?
The permanent cancellation of the expat levy is a clear signal: Saudi Arabia wants you to manufacture locally. Don’t let your business be left behind paying unnecessary fees.
Contact our team today for a Free Industrial License Eligibility Assessment
- FAQs
Frequently Asked Questions
If your question is not addressed here, please feel free to reach out to us. We value your inquiry.
Has the Saudi expat levy been cancelled for all companies?
No. The permanent cancellation (revocation) applies specifically to licensed industrial facilities. Commercial, retail, and service-based companies must still pay the standard expat workforce fees.
When does the industrial expat fee exemption expire?
It does not expire. As of the Cabinet decision on December 17, 2025, the fee is permanently revoked for valid Industrial License holders.
What is the main benefit of a Saudi Industrial License?
Following the 2025 update, the primary benefit is the permanent exemption from expat workforce levies, which significantly reduces operating costs (OPEX). Other benefits include customs duty exemptions on imported raw materials and access to subsidized industrial land.
Where can I verify this news?
The decision was officially announced by the Saudi Cabinet and reported by the Saudi Press Agency (SPA)
