Oman Budget 2021: VAT to be imposed from April

Education and health sectors and some basic commodities will be exempted from the tax

  
VAT increase Some growing stacks of coins with the word VAT on them. Image used for illustrative purpose

VAT increase Some growing stacks of coins with the word VAT on them. Image used for illustrative purpose

Getty Images/Photography taken by Mario Gutiérrez.

Muscat: The Value Added Tax (VAT), the indirect tax on consumption in which final consumers will ultimately bear the cost of VAT, will be imposed on goods and services in Oman starting from April 2021.

Education and health sectors and some basic commodities will be exempted from the tax.

According to Royal Decree No. (121/2020), a six months grace period was granted for the taxpayer to register and prepare their internal system to implement the VAT.

The value-added tax rate of 5 % to be applied in Oman is among the lowest rates at the international level. Therefore, it is expected that the impact of VAT on the cost of living in Oman will be minimal.

The VAT will have a positive impact on the economic and social development and the international competitiveness of Oman. 

The financial resources obtained from this tax will contribute to building a sustainable economy for future generations, and it will also contribute to improving public services and continuing the development of infrastructure in the future.

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