Oman: The Tax Authority today issued three executive decisions pertaining to the implementation of the Value Added Tax (VAT), which will enter enforcement stage by April 16, 2021, according to the Oman News Agency, which has revealed that 94 mostly food items have been exempted from tax.   

Oman’s Ministry of Finance stressed that the implementation of this tax is estimated to generate over $780m, thus helping fill the budget deficit. 

The first decision specified that registration to the Tax Authority becomes compulsory if the taxpayer’s annual supplies stand at $100,000 or more or are expected to reach this ceiling. 

The decision set the ceiling of voluntary registration to the Tax Authority at $50,000 and states that, accordingly, the taxpayer may apply for voluntary registration if the applicant’s annual supplies stand at, or cross or expected to go beyond the value of $50,000. 

Determining ceilings for compulsory and optional registration comes within the context of the provisions of the GCC Unified VAT Agreement, which the Sultanate signed in November 2016. 

The second decision states that taxpayers whose value of annual supplies crosses or is expected to cross $2,600 have to register to the Tax Authority during the period from Feb.1 2021 to March 15, 2021. Accordingly, the VAT for this segment becomes applicable from April 16, 2021. 

As for taxpayers whose value of supplies crosses or is expected to cross $1,300, their registration begins from April and the deadline of registration will be July 1, 2021. The deadlines of lower segments follow a similar slope (per volume of supplies) till the minimum level of $100,000 worth supplies. 

The decision grants taxpayers a right to register voluntarily to the Tax Authority with effect from Feb. 1, 2021 in case the value of their supplies crosses or is expected to cross $50,000. in order to ensure that the small and medium-sized business sectors that wish to register the VAT system are not affected, and can take advantage of the generated benefits, such as the refund of the tax right bore on their proceeds. 

The third decision specified the type of foodstuff exempted from the VAT. The list consists of 94 customs tariff items to be exempted from the VAT, namely meats, fish, poultry, dairy products, fresh eggs, vegetables, fruits, coffee beans, tea, cardamom, grains, olive oil, sugar, baby food products, bread, bottled water and table salt.