The cost of alcohol, tobacco and energy drinks are set to rise from the beginning of next year, HE Saud bin Nasser al Shukaili, the Secretary General of Taxation at the Ministry of Finance, has confirmed.
In a report carried by the Oman News Agency earlier this week, al Shukaili said: “The tax will be approved next week and will be implemented starting from 2017.”
Al Shukaili added that the Sultanate’s taxation system in general would be amended, including the tax rates levied on companies during the “coming period”.
The Ministry of Finance had already submitted an amended rate to the Majlis Al Shura and State Council for consideration by the Council of Oman.
Meanwhile, Oman’s plan to introduce a Value Added Tax (VAT) remained on track and an agreement on the rate of tax was ready for signing, al Shukaili said.
“The implementation will start in 2018 as implementation is linked to having a local law in the Sultanate,” he said.
“The draft law has been prepared and will be submitted to the legislative authorities for revision.”
Earlier reports suggest that a 5 per cent VAT tax will be implemented across the GCC. This would help to shore up Oman’s burgeoning budget deficit and boost government revenue by between RO250 million and RO300m per year.
In June, GCC finance ministers met in Jeddah, Saudi Arabia, to approve the VAT treaties, paving the way for excise tax to be introduced on January 1, 2017, and VAT on January 1, 2018.
The common GCC tax treaty is aimed at reducing reliance on the petrodollar in the wake of prolonged record low prices for crude.