On 1 January 2026, Riyadh issued White Land Tax invoices to more than 60,000 landowners — the first billing cycle under a rate that had just tripled from 2.5% to 10%. Within three months, land transactions across the city had fallen 55% year-on-year, and total land sale value dropped 65% to SAR 20.71 billion. That is not a rounding-error policy change — it is one of the most consequential real estate tax reforms in the Kingdom’s recent history, and it applies to any owner sitting on 5,000 square metres or more of undeveloped urban land.
One thing worth stating plainly before anything else: White Land Tax is not administered by ZATCA. It sits under the Ministry of Municipal, Rural Affairs and Housing (MOMRAH, sometimes referenced as MOMAH), a separate government body from the tax authority that runs VAT, CIT, WHT, Zakat, and RETT. This article covers what the tax actually is, who owes it, and what changed in 2025 and 2026.
What White Land Tax Is, and Why It Exists
White Land Tax is an annual fee charged on large parcels of undeveloped urban land, designed to discourage land banking — the practice of holding serviced, developable land vacant while waiting for its value to appreciate. The policy goal, stated directly by the Ministry, is to increase the supply of developed land, balance housing supply and demand, and curb the kind of speculative land-holding that pushes up property prices without adding housing stock. It is a direct piece of the Kingdom’s Vision 2030 housing agenda.
The original White Land Fees Law dates to 2016. In April 2025, the Council of Ministers approved a substantial overhaul under Royal Decree No. M/244, and the law was renamed the “White Land and Vacant Real Estate Tax Law” — reflecting an expanded scope that now also targets vacant, already-developed real estate, not just empty land. The Ministry published the Implementing Regulations for the white land component in the Official Gazette on 22 August 2025.
The Rate, and Who Meets the Threshold
The maximum annual fee is 10% of the land’s value — up from 2.5% under the previous regime, a change that took effect for the January 2026 billing cycle. The fee applies to land parcels (or combined holdings by a single owner within one city) of at least 5,000 square metres. Below that threshold, the fee does not apply.
| Element | Detail |
|---|---|
| Maximum annual rate | 10% of land value (up from 2.5% previously) |
| Minimum land size | 5,000 m² (single parcel or combined holdings in one city) |
| Geographic scope | Zones designated by ministerial decision, tiered by urban development priority within each city |
| First enforced billing cycle | 1 January 2026, Riyadh (60,000+ landowners invoiced) |
The 10% figure is a ceiling, not a flat universal rate — targeted areas are divided into tiers based on each city’s urban development priorities, and the Ministry periodically reviews unit availability, supply, and pricing to decide whether to apply, adjust, or suspend fees in a given zone.
Registration and Payment
Affected landowners must register their property through the Ministry’s dedicated electronic portal within statutory periods announced in official publications. The portal for this program is run through MOMRAH’s “idle lands” platform. Landowners working through development approvals can also use the Ministry’s “Etmam” Developers Services Center, which is designed to expedite master plan and building permit approvals.
Landowners in Riyadh’s 2026 cycle must either pay the fee or begin development within a year of the invoice. Sitting on the land without registering, paying, or developing is not a viable long-term position once a parcel falls inside a designated zone.
Exemptions and Relief
The Implementing Regulations set out specific circumstances where the fee doesn’t apply or can be deferred:
- Legal impediments. If a genuine legal obstacle prevents a permit from being issued — and the delay is not caused by the owner — the fee does not apply for that period.
- Completed development within the statutory period. If construction is finished within the fee-payment period the regulations allow, the fee application is cancelled for that cycle.
- Ministry-granted extensions. The Ministry has discretion to grant additional development time based on the nature and size of the land — this is not automatic and needs to be requested and justified.
None of these are self-executing. An owner who believes they qualify for an exemption or extension needs to actively engage with the Ministry’s process, not simply assume non-payment will be excused after the fact.
The 2026 Riyadh Rollout — What Actually Happened
Riyadh’s first billing cycle under the new 10% rate is the clearest real-world evidence of how seriously this policy is being enforced. More than 60,000 landowners received invoices on 1 January 2026. The market response was immediate and sharp: land transactions across Riyadh fell 55% year-on-year in the first quarter of 2026, and the total value of land sales dropped 65% year-on-year to SAR 20.71 billion.
That drop is the tax working as intended, from the Ministry’s perspective — it is designed to push landowners toward either developing their holdings or selling to someone who will, rather than continuing to hold land as a passive, appreciating asset. For an owner still holding undeveloped land in a designated Riyadh zone, this is not a hypothetical future cost; it is already being billed.
What Landowners Should Actually Do
- Check whether your land falls inside a designated zone. Zone designation is city-specific and tiered — a parcel’s status is not something to assume from a general rule of thumb.
- Register through the official portal within the statutory window once your land is confirmed to be in scope — don’t wait for an invoice to arrive before engaging with the process.
- Model the real cost of holding vs. developing vs. selling against the 10% annual rate — at that level, the calculus for many landowners has fundamentally changed compared to the 2.5% era.
- If a genuine legal impediment is blocking your permit, document it and engage the Ministry directly — the exemption exists, but it is not automatic.
Frequently Asked Questions
An annual fee on undeveloped urban land of at least 5,000 square metres, charged at up to 10% of the land’s value, administered by the Ministry of Municipal, Rural Affairs and Housing (MOMRAH) to discourage land banking and increase developed land supply.
No. White Land Tax is administered by MOMRAH, not ZATCA. This is a key distinction from VAT, CIT, WHT, Zakat, and RETT, which are all administered by the Zakat, Tax and Customs Authority.
Up to 10% of the land’s value annually, effective for the January 2026 billing cycle — triple the previous 2.5% rate under the pre-2025 law.
5,000 square metres, whether as a single parcel or combined holdings by one owner within a single city. Below that threshold, the fee does not apply.
More than 60,000 landowners in Riyadh received invoices on 1 January 2026, the first cycle under the new 10% rate.
Yes — where a genuine legal impediment (not caused by the owner) prevents permit issuance, where development is completed within the statutory period, or where the Ministry grants a development extension based on the land’s nature and size.
In Riyadh’s 2026 cycle, landowners must either pay the fee or begin development within a year of the invoice. There is no indefinite holding option once a parcel falls inside a designated zone.
- White Land Tax is administered by MOMRAH, not ZATCA — a distinct regime from the Kingdom’s other major taxes.
- The rate rose from 2.5% to up to 10% of land value, effective for the first 2026 billing cycle, applying to undeveloped urban parcels of 5,000 m² or more.
- Riyadh’s first invoicing round (1 January 2026) reached over 60,000 landowners and was followed by a 55% drop in land transactions and 65% drop in land sale value year-on-year.
- Registration runs through MOMRAH’s dedicated electronic portal, with the Etmam center available to expedite development permits.
- Exemptions exist for genuine legal impediments and completed development within the statutory period, but none are automatic — owners must actively engage the Ministry’s process.
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Sources
- MOMRAH — Implementing Regulations of the White Land Fees Law — official rates, thresholds, exemptions, and registration process
- KPMG Saudi Arabia — Publication of Implementing Regulations for White Land Tax — legal timeline and Royal Decree reference
- AGBI — Saudi Arabia Bills 60,000 Landowners Under New Tax Rule — January 2026 Riyadh billing cycle details
- AGBI — Saudi Land Sales Slump After Higher Tax Kicks In — Q1 2026 market impact data
- Grant Thornton — Issuance of the Implementing Regulations for the White Land Fees — regulatory summary
This article is based on MOMRAH’s official Implementing Regulations for the White Land Fees Law and contemporaneous reporting from KPMG, Grant Thornton, and AGBI on the January 2026 Riyadh billing cycle. White Land Tax is administered by MOMRAH, not ZATCA, and dariba.co’s usual sourcing relationships do not extend to this ministry. It is provided for general information only and does not constitute legal or tax advice. Confirm current zone designations, rates, and deadlines directly with MOMRAH before relying on this article for a specific parcel. dariba.co is an independent platform with no consulting relationships.