MANAMA: Bahrain’s government will continue to shoulder the cost of VAT on utilities for citizens, even after the tax is increased from the current five per cent to 10pc.

Finance and National Economy Minister Shaikh Salman bin Khalifa Al Khalifa has confirmed that the government will continue to subsidise the electricity and water bills for the primary house of citizens and shoulder the cost of the value-added tax (VAT) on it, Parliament’s finance and economy affairs committee member Zainab Amir told our sister paper Akhbar Al Khaleej yesterday.

The assurance came in reply to a question by her during a high-level meeting the government had with Parliament and the Shura Council’s representatives last Sunday.

Denying that any citizen pays VAT on utility bills, the minister had confirmed that there is no change in the way the electricity and water rates are calculated for the primary house of citizens. He denied that citizens bear the cost of VAT on electricity bills, saying that the government is the one who shoulders the cost.

The Cabinet had in 2020 decided, based on a recommendation by the Government’s Executive Committee, that the government would absorb the cost of VAT on water and electricity, without changing the rate of the tariffs.

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