VAT introduction in the Gulf Cooperation Council countries.

The following countries have indicated that they intend to introduce a VAT system for the first time from 1 January 2018:

Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates.

This is a likely result of costly military campaigns and a drop in global oil prices. Although it has been agreed that, to limit smuggling and competitiveness, the countries aim to introduce the tax at the same time it is likely that some countries may defer implementation to a later date.  It is thought that healthcare, education, social services and a limited list of food items will be excluded and that introductory rate will be 5%.

Tip: Businesses trading with customers and clients in these countries may need to review their tax obligations, budgets, contracts and other arrangements before the introduction of VAT.