Oman To Implement “Selective Tax” Soon

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Oman will soon follow in the footsteps of Saudi Arabia, UAE, Bahrain and Qatar in imposing a selective tax on tobacco, alcohol, energy and carbonated drinks.

With its implementation, prices of tobacco products, alcoholic beverages and energy drinks will double as it will attract an excise tax of 100%, while tax will go up by 50% on fizzy drinks.

The GCC framework on ‘Unified Selective Excise Tax’ is expected to be formally ratified this year after it was reviewed and endorsed by the Majlis A’Shura and the State Council at the end of 2018.

Dubbed as ‘sin tax’, the excise tax to be imposed on selected goods and beverages, seen to have a level of harm associated with their consumption, was first unveiled in Oman’s 2017 budget.

The step is based on the decision taken by the Supreme Council of GCC at its 36th session held in Riyadh in 2015.

Following this, Saudi Arabia introduced the excise tax in June 2017, followed by the UAE from October and Bahrain from December 30 the same year.

Dr Sulaiman al Dhakheel, general manager of the Gulf Health Council, said that increasing the taxation is the most effective method to reduce tobacco use and demand.

He added that the average price of tobacco in EMR is lowest in comparison to other regions. A 10% increase in tobacco taxes leads to a 4% reduction in consumption in the high-income countries and 8% in the low-and-middle-income countries, he added.

Source Credit: Muscat Daily

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