Oman to implement 5 per cent VAT
Wednesday, 10 14 2020, Category: Economy, Country: Oman
Oman has issued a decree to start levying a 5 per cent value-added tax (VAT) in six months' time, state-run Oman TV said on Monday.
The tax will be on most goods and services, though with some exceptions, according to a video presentation shown on Oman TV.
All six Gulf Arab states agreed to introduce 5 per cent VAT in 2018. Saudi Arabia, the UAE and Bahrain have already introduced the tax, with Riyadh tripling it this year.
Oman, Kuwait and Qatar have not yet introduced the tax.
"The introduction of VAT is another important and positive sign to the market that Oman is looking to progress with a much needed fiscal reform programme after announcing spending cuts this year," said Monica Malik, chief economist at Abu Dhabi Commercial Bank.
Facing a 2.8 per cent economic contraction this year and a government deficit of 16.9 per cent of gross domestic product (GDP), according to the International Monetary Fund, Oman has cut public spending to contain the financial leakage caused by lower oil prices and the downturn caused by coronavirus lockdowns.
Source: Khaleej Times