The plan is designed to restructure the Saudi Arabian economy away from its heavy reliance on oil, and is thought likely to identify 18 economic sectors for possible subsidy cuts, tax rises or privatisations.
“The Council of Economic and Development Affairs has approved the final draft of the National Transformation Plan, which is one of the plans adopted and part of the 2030 vision, which was launched and adopted by the Saudi deputy crown prince, president of CEDA,” a senior Saudi source told news agency Reuters.
Details of the plan will be disclosed in daily news conferences with government ministers starting Monday evening, Reuters reported.
Saudi Arabia’s finances now heavily depend on oil revenue and its economic performance closely tracks government spending. But with energy prices having fallen sharply since mid-2014, the government has faced a steep fall in income which has put growth at risk.
The resultant widening in the government’s budget deficit, which reached $98bn (£68bn, €86bn) in 2015 or 16% of GDP, has seen it tap the global capital markets for a $10bn loan and more recently to sell a possible $15bn dollar-denominated bond.
The country is already part of a plan by the six nations of the Gulf Cooperation Council (GCC) to implement a new VAT system, one of the first direct taxes in the region, which is due to be implemented by late 2018.
The broader Vision 2030 agenda also includes a partial privatisation of state oil giant Saudi Aramco, the transformation of the government’s Public Investment Fund into one of the world’s biggest sovereign wealth funds, and a new visa system to allow expatriates to live in the country for extended periods. These plans have yet to be formally approved.