DOHA (Al Jazeera) — Saudi Arabia has announced tough new austerity measures aimed at shoring up state finances which have been battered by low oil prices and the coronavirus pandemic.

From July 1, it will raise its Value Added Tax (VAT) from 5 to 15% and suspend a cost of living allowance for workers.

To discuss the effect of these moves, Al Jazeera spoke to Ali AlAhmed via Skype from Washington, DC, in the US. He is the director of the Institute for Gulf Affairs