Workshop highlights challenges of VAT implementation

Eng Redha Juma al Saleh, Chairman of Oman Chamber of Commerce and Industry (OCCI), inaugurated a daylong VAT Practical Masterclass organised by leading accounting and advisory firm Crowe Oman at the Crowne Plaza Hotel Qurum on Tuesday.

Speaking on the occasion, Al Saleh said: “Many businesses are yet to comply with the registration requirements of the Oman VAT Law. The Oman Chamber of commerce and industry is interacting with the business community to mitigate the problems faced by them by coordinating with various ministries to bring these to the attention of the government.”

Earlier, welcoming the participants, Davis Kallukaran, Managing Partner of Crowe Oman, said that Oman has one of the lowest rates of VAT with just 5 per cent for goods and services with limited number of zero ratings and highest number of exemptions compared to other countries in the region. This is significantly lower than the OECD average rate of 19 per cent,” he added.

Presenting a technical session on the mechanics of Oman VAT, Antony Kallukaran, Associate Partner for Tax Advisory Services, said the VAT regime is aligned with the GCC VAT frame work.

“The UAE and Saudi governments had gone ahead with the implementation of VAT in 2018, followed by Bahrain in 2019. This gave great advantage to Oman to learn the issues, challenges and the solutions to problems faced by those countries in the implementation of VAT. Right from the registration to the administration of the VAT regime, strict fines and penalties have been enacted in the law for non-compliance. This is because businesses are merely tax collectors on behalf of the government and they are expected to remit the money collected from the public to the government on a timely basis. Businesses and corporates need to be aware of the provisions of the VAT Law that can invite administrative fines and penalties for non-compliance and may also attract imprisonment for breaching the provisions of the VAT Law,” he added.