Tax Flash: Publication of Implementing Regulations for White Land Tax

On 22 August 2025, the Implementing Regulations for White Land Tax were published in the Official Gazette (Umm Al-Qura). These regulations follow the official publication of Resolution No. 758 and Royal Decree No. M/244 in May 2025, which introduced significant amendments to the original “White Land Tax Law” (in effect since 2016). The amended law, renamed into “White Land and Vacant Real Estate Tax Law,” expands its scope to not only include undeveloped urban land (“white land”) but also vacant real estate (unused buildings), reflecting the Kingdom’s push to curb land hoarding and promote sustainable urban development. While the Implementing Regulations for White Land Tax have now been issued, the Implementing Regulations for Vacant Real Estate Tax are expected within the coming year.

• The regulations define new terms such as “land construction,” “land development,” “taxpayer,” “geographical zone,” and “tax invoice” for clarity in applying the regulations. (Article 1).
• A taxpayer is defined as any natural or legal person (excluding state-owned property) in whose name a land ownership document (title deed) is registered at the time of tax invoice issuance. This includes successors under law or Sharia. (Article 1).
• The regulations clarify that where land is jointly owned, each person must pay tax in proportion to their ownership share. (Article 2).

• Each city subject to tax will be specified by an announcement, supported by an urban boundary map published on the Ministry of Municipalities and Housing (MOMAH)’s website. (Article 5).
• Taxpayers must provide required ownership and land documents via an electronic portal within the timeframe set by the announcement, while new landowners who acquire white land after this set period are granted 30 days from the date of ownership transfer to submit the documents. (Article 5).
  
• Geographical zones within each city subject to tax will be designated by ministerial decision, setting annual tax rates, white land uses, and the minimum land area thresholds. (Article 6).
• For land to be subject to tax, the following conditions must be met (Article 7):

1. It must be considered white land (undeveloped and suitable for development or construction).
2. It must be located within designated urban limits.
3. Its area, or aggregated ownership within the city limits, must be no less than 5,000 square meters.
4. Its use must fall within the categories specified in the ministerial decision.

Annual tax rates applicable to white land (or groups of white land) within geographical zones shall be determined based on urban development priorities, as follows (Article 6):

• Tier 1 (Highest priority): An annual tax of 10 percent of the land value.
• Tier 2 (High priority): An annual tax of 7.5 percent of the land value.
• Tier 3 (Medium priority): An annual tax of 5 percent of the land value.
• Tier 4 (Low priority): An annual tax of 2.5 percent of the land value.
• Tier 5 (Outside the scope of priority): No annual tax is imposed, but the land is counted within the total white land owned by the taxpayer within the city limits.

• Taxation is suspended if the land no longer meets Article 7 conditions, if obstacles beyond the taxpayer's control prevent disposal, development, or construction within the statutory tax payment period, or if development or construction is completed within that same period. (Article 8).
• Tax shall be suspended for a period determined by a decision from the Minister if the land development is completed in a manner that does not conflict with the schedule for issuing annual tax invoices in the city. (Article 8).
• If tax application is suspended on a portion of the white land after tax invoice issuance, tax shall still apply to the remaining portion. (Article 8).

• The tax invoice notification must include, at a minimum: taxpayer’s name and legal information, land ownership document number, legal reference, land location, tax rate, amount due, payment due date, and method of payment. It must also outline the consequences of non-payment or delay, and the taxpayer’s right to object. (Article 11).
• All official communications and notifications to the taxpayer are considered valid and legally binding if delivered through any verified channel, such as the electronic portal, mobile number, email, or national address, provided these are registered either by the taxpayer on the portal or at the National Information Center or made available through approved electronic systems (Article 12).

• The taxpayer must pay the tax within one calendar year from the invoice issuance date. If the issued invoice relates to prior years, it takes effect upon issuance, and payment is due within 90 days of notification. (Article 13).
• In case an extension is granted for the development or construction of the land, per Article 8, then the tax shall be due after the extension period has ended.
• If land development or construction is completed within the statutory period for tax payment, or within the additional period granted per Article 8, the tax amount paid for those periods shall be refunded to the taxpayer. (Article 13).
• If the taxpayer wishes to sell the white land before completing its development, then they must settle the tax amount prior to the transfer of ownership. (Article 13).

The Ministry shall compile a list of violations and fines resulting from breaches of the law or the regulations, and it shall be issued by a decision from the Minister after approval by the ministerial committee. (Article 14).

Our tax team is available to assist businesses and taxpayers in:

• Assessing land and property holdings under the new law and regulations.
• Reviewing compliance obligations and preparing documentation.
• Supporting with dispute resolution.
• Advising on potential implications once the regulations for vacant real estate tax are published.

The Implementing Regulations for White Land Tax, accessible here.

Resolution No. 758 and Royal Decree No. M/244, accessible here.