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Oman plans to implement 5% VAT in 6 months

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Cash-strapped Oman is planning to introduce a 5 percent value-added tax in April, following the lead of Gulf neighbors.

Essential food items, medical care, education and financial services will be exempt from the planned levy, according to a royal decree detailing the tax.

Oman, the biggest oil exporter outside OPEC, was among the more vulnerable economies in the six-nation Gulf Cooperation Council even before it was lashed by falling crude prices and the coronavirus pandemic. Its budget deficit as a share of gross domestic product is anticipated to be among the highest in the region, according to the International Monetary Fund.

READ  Oman eyes UAE expats, Emiratis in tourism revamp

The UAE and Saudi Arabia imposed a 5 per cent VAT in 2018. Saudi Arabia tripled its tax this year.

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