Oman is all set to roll out its 5% value-added tax (VAT) nationwide. Oman is the third country in the Arab world to introduce a 5% VAT. This follows the UAE and Saudi Arabia, which implemented this taxation plan in 2018.
The new regulation is expected to generate 1.5% of Oman’s gross domestic product (GDP) and generate about 400 million Omani riyals annually.
Oman All Set to Enforce 5% VAT Starting April
Saud bin Nasser Al Shukaili, Director of Taxation in Oman, said all preparations and requirements for implementing VAT are in place. According to Gulf News, this includes the promulgation of tax-related regulations, the use of taxable computer systems and electronic devices, and electronic links with relevant authorities.
The Heath of Tax Authority also approved the Executive Regulations for the Value Added Tax (VAT) Law.
The list of tax-exempt products and services includes medical, educational, financial services, basic food and supplies for people with special needs, and other products and services.
“All the necessary preparations and requirements for the implementation of the value-added tax decided on April 16 have been completed in terms of issuing legislation related to tax, operating the tax computer system, and electronic linking with the authorities concerned with the application and strengthening the human cadre in the agency,” Al Shukaili said.
Al Shukaili emphasized that the current global economic environment requires VAT, which produces about 15% of the country’s GDP. “It is estimated that 400 million will be collected each year from this tax,” he added.
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