The items in questions are detailed in an executive decision issued by Oman’s Tax Authority on Wednesday.
The list includes meat, fish, poultry, dairy products, fresh eggs, vegetables, fruits, coffee, tea, cardamom, cereals, olive oil, sugar, baby foods and cereals, bread, bottled drinking water and table salt.
In a series of executive decisions issued on Wednesday, the Tax Authority also announced the framework and related guidelines for registration of tax-eligible businesses and organisations in the Sultanate.
Businesses with an annual turnover of a minimum of RO 38,500 are required to mandatorily register with the Tax Authority. However, registration is optional for businesses with a minimum turnover of RO 19,250.
These limits are in with the provisions of the GCC Unified VAT Agreement signed by the Sultanate in November 2016.
SMEs and micro-businesses have been given additional time to register their firms in order for them to equip themselves with the requisite IT systems and bookkeeping methods required to comply with the requirements of the VAT law.
First to register will be businesses with an annual turnover of over RO 1 million. They must register between February 1 and March 15, 2021.
For businesses with a turnover of over RO 500,000, the deadline for registration is July 1, 2021.
VAT is an indirect tax on most goods and is levied on the value-added of business operations, which is the difference between the final price of a commodity and the cost of materials and services.
Confirming the implementation of VAT, the Ministry of Finance announced in the 2021 General Budget that the new level would be imposed on goods and services in Oman starting from April 2021, with exception of the education and health sectors and some basic commodities.
According to Royal Decree 121/2020, a 6-months grace period has been granted for the taxpayer to register, and prepare their internal system to implement the VAT. The value-added tax rate of 5 per cent to be applied in Oman is among the lowest rates at the international level.
“Therefore, it is expected that the impact of VAT on the cost of living in Oman will be minimal. The VAT will have a positive impact on the economic and social development and the international competitiveness of Oman.
The financial resources obtained from this tax will contribute to building a sustainable economy for future generations, and it will also contribute to improving public services and continuing the development of infrastructure in future,” the ministry noted.
Source Link: www.omanobserver.om