Oman no VAT until at least 2021?
- Jan 2, 2020 | Richard Asquith
Oman looks set to postpone the implementation of Value Added Tax until at least 2021. A Ministry of Finance official has stated that there will be no VAT launch this year. However, the Ministry has said in the past that exclusion of VAT from the 2020 budget does not preclude it from a launch this year.
The postponement had already been disclosed in a July 2019 bond prospectus. It is due to slow economic performance and low consumer sentiment. Oman’s credit rating is now rates ‘junk’ by some of the major credit agencies, and the country’s deficit may reach 10.6% this year. Much of the country’s problems are down to the continuing supressed oil price which is around $60 per barrel.
Despite the delay in introducing a VAT regime, some excise taxes have been implemented in the past twelve months.
In 2018, all six of the Gulf Cooperation Council states agreed to introduce a harmonised 5% VAT regime and customs union. So far, only Saudi Arabia, UAE and Bahrain have proceeded.
