Selective tax (excise) law approved by the State Council and Majlis A’Shura in Oman.
A joint State Council and Majlis A’Shura session was called on the orders of His Majesty Sultan Qaboos and a draft law for tax on selective goods was approved on 14 November 2018.
Member states of the Gulf Cooperation Council (GCC) had agreed to introduce a selective tax on goods deemed harmful to human health and the environment, as well as luxury goods. Saudi Arabia, the United Arab Emirates and Bahrain implemented this selective tax on carbonated drinks, energy drinks and tobacco products in 2017. Oman is likely to extend the tax to alcohol, pork and eventually to luxury goods.
It now seems likely that the Sultanate will introduce a selective tax in early 2019. Considering the rate of tax could range from 50 to 100 percent, the monetary impact may be significant and, if the transition is not handled effectively, could result in business disruptions.
If you have any questions on how selective tax is likely to impact your organization and need assistance preparing for implementation, please reach out to your KPMG advisors on indirect tax.
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