Muscat: The Ministry of Finance is targeting September 1, 2019 for implementation of the Value Added Tax (VAT) in Oman, but the date is under review and not yet finalised, a senior government official said on Tuesday.
Speaking to the Observer, Sulaiman bin Salim al Adi, Director-General of Survey and Tax Agreements at the the Ministry of Finance, said: “There was an announcement to implement VAT from September 1, 2019, but that date is under review as the proposal has to go through various levels, including the State Council and Majlis Ash’shura, among others.”
With regards to the awareness campaign, he said: “We have our own plans to prepare the country and the people for this, which will be implemented only once the date is finalised.
There will be enough time, to be precise, not less than a year before the date of implementation.”
Earlier, the seminar organised by Oman Chamber of Commerce and Industry (OCCI), which was also attended by Adi, Dr Salih bin Said Masan, Chairman of Majlis Ash’shura’s Economic and Financial Committee, and Ahmed bin Ali al Makhini, researcher, adviser on general policies, several issues were raised about the ideal timing for the launch of this particular tax, especially when the economy is facing some challenges. A member of the audience suggested that its implementation should be delayed by three years 2022, while another participant called it ‘unfair’ as it will uniformly target both the low and high income sections.
Adi said the VAT will be not imposed in the health, education, part of the housing and logistics sectors and 94 food items.
“Taxes are complicated and we accept all types of opinions. We will have regulations that will be studied in fine detail,” he said.
Al Makhini said people should be educated on the application of taxes because it is a necessary evil.
Masan felt new taxes should be imposed not during recession, but at the time of economic expansion because companies generally had large profit margins during that time.
The OCCI has launched the first specialised seminar which is part of the annual programme for Umsiyat — an initiative promoted by the board.
The first one which was held on Tuesday under the theme ‘Value Added Tax, the reasons, aims and possible effects on economy and development,’ highlighted the trend to impose value added tax and the speakers highlighted the pros and cons as well as the socioeconomic effects of VAT on the Sultanate.
The seminar covered a number of themes, the most important of which is to know the reasons that led the government to apply the tax as well as the economic and social benefits from it.
These seminars are aimed at reaching novel, practical and implementable solutions for the challenges facing the Omani economy.
They also highlight the possible effects of such challenges on the growth of national economy.
The Ministry of Finance in Oman has postponed the decision to apply the ‘Value-Added Tax’ (VAT) until 2019, the government said in December last year.