* All Saudi Arabian banks decline but one
* Aramco to announce Q1 earnings on Tuesday
* UAE has no plans to follow Saudi in VAT increase
By Ateeq Shariff
May 11 (Reuters) - Saudi Arabia's stock market ended lower
on Monday after the kingdom said it will triple value-added tax
(VAT) and suspend a cost of living allowance for state workers
as it seeks to shore up its finances.
The austerity measures are being introduced as the world's
largest oil exporter suffers from slumping oil prices, while at
the same time measures to fight the new coronavirus outbreak are
likely to curb the pace and scale of economic reforms launched
by Crown Price Mohammed bin Salman.
Finance Minister Mohammed Al-Jadaan said the cost of living
allowance would be suspended from June 1, and VAT would be
increased to 15% from 5% from July 1.
Saudi Arabia's benchmark index dropped 1.2%, with Al
Rajhi Bank falling 1.5% and National Commercial Bank
, the country's largest lender, losing 2.4%.
State-owned oil giant Saudi Aramco was also down
0.8% ahead of its first-quarter earnings announcement on
Tuesday.
In Dubai, the index fell 1%, driven by losses in
financial shares. Sharia compliant lender Dubai Islamic Bank
ended down 2.3%, while Emirates NBD Bank
lost 0.9%.
The Abu Dhabi index closed flat. Aquaculture firm
International Holding jumped 9.2%, whereas Abu Dhabi
Commercial Bank declined 2%.
The lender reported an 84% fall in first-quarter net profit
last week as it took $292 million in impairments on debt
exposure to troubled hospital operator NMC Health and payments
group Finablr.
Meanwhile, the United Arab Emirates was not currently
planning to follow Saudi Arabia by raising its VAT rate from 5%,
the finance ministry said on Monday.
Qatar's index fell 0.5%, hurt by a 7% slide in United
Development.
Egypt's blue-chip index added 0.4%, with tobacco
monopoly Eastern Company climbing 6.3%.
SAUDI ARABIA dropped 1.2% to 6,604 points
ABU DHABI was flat at 4,121 points
DUBAI declined 1% to 1,884 points
QATAR eased 0.5% to 8,864 points
EGYPT rose 0.4% to 10,296 points
BAHRAIN lost 1.3% to 1,252 points
OMAN slipped 0.1% to 3,466 points
KUWAIT was down 1% at 5,120 points
(Reporting by Ateeq Shariff in Bengaluru; Editing by Kirsten
Donovan)
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