BDO Oman held a seminar on Value Added Tax (VAT) on Thursday, 29 September 2016 at the Jibreen Ballroom of Muscat Intercontinental Hotel. The seminar was conducted to analyse the implications as well as to share knowledge on VAT which is proposed to be introduced in the GCC states by 2018/2019. The seminar brought together over 150 leading finance professionals representing several significant companies in Oman, who had the opportunity to expand their knowledge and gain international experience from the BDO speaker, Ivor Feerick, Chair of the BDO International VAT Centre of Excellence.
In the opening remarks, Bipin Kapur, Managing Partner, BDO Oman said, “There are almost 200 countries in the world of which around 170 countries have VAT or a similar form of indirect tax. The signing of VAT and Excise treaties may result in indirect tax process consolidation in the GCC through diversification of government revenues and reduction of subsidies. Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the UAE are expected to sign a common VAT Framework Agreement, which will set the VAT principles to be adopted.”
During the presentation, Mr. Feerick observed that, “the introduction of an indirect tax regime will necessitate business entities, which are statutorily bound to collect and pay VAT, to strengthen their accounting and internal procedures in all aspects. This will offer opportunity for auditing, and professional services firms to advise clients on how to introduce greater efficiencies, and enable their businesses to cope with the expected scrutiny from the authorities to comply with the VAT statute, once introduced.”
VAT practices are expected to be introduced by the year 2018 in UAE and Kuwait whereas the dates and the road map for implementation in other GCC countries are yet to be announced.
Barring a few essential commodities such as basic foodstuffs, education and health care services which may be either exempt or zero-rated, it is initially expected that 5% VAT will be levied on all other goods and services in the GCC countries, including Oman.
The seminar was concluded by Bipin Kapur presenting an Omani dagger memento to the visiting expert, Ivor Feerick.