VAT comes into effect from April 16

MUSCAT: Saud bin Nasser al Shukaili, Chairman of the Tax Authority, on Sunday issued Decision No 53/2021 promulgating VAT Law’s executive regulation, based on the provisions of Royal Decree No 121/2020 on VAT Law. The bylaw includes all procedures related to general provision stated in the VAT Law, like registration, repayment, tax collection and details about the tax, including methods of objection and petition. The executive regulation consists of 13 parts comprising 211 articles. He said that some goods are charged zero tax and that Decision No 2/2021 covers 93 such items, including medical drugs and equipment. “The Sultanate is expected to generate 1.5 per cent of the value of Gross Domestic Product or RO 400 million per year from VAT’’, said Al Shukaili, noting that the VAT figures among the types of tax which do not affect the business sector and, instead, have a potential to generate abundant revenue as per its global applications. Al Shukaili affirmed that all preparations and necessary requirements have been finalised for the application of VAT from April 16, 2021. The steps include issuance of statutes related to VAT (the law and executive regulation) the operation of VAT computer system and electronic collection with the departments concerned. In a statement to Oman News Agency (ONA), Al Shukaili said the application of VAT is made in accordance with exhaustive studies undertaken over a long period of time. The studies covered the economic and social impacts of the VAT. Study in Oman showed that the impact of VAT on consumers will be minimal. — ONA