Oman Indirect Tax Update

Oman Secretariat General for taxation (“SGT”) has recently released a guide on the implementation of Excise Tax, a list of frequently asked questions and excise registration manual.

Highlights:

• 1.
• National excise tax law was published in the Official gazette on March 17, 2019. The law comes into effect 90 days from this date (i.e. June 15, 2019)

• 2.
• List of excise goods and the respective tax rates:

• 2.
• a.
• Tobacco and tobacco derivatives – 100%

• 2.
• b.
• Carbonated drinks – 50%

• 2.
• c.
• Energy drinks – 100%

• 2.
• d.
• Alcohol – 100%

• 2.
• e.
• Pork products – 100%

• 3.
• Excise Tax will be levied on the higher of the Retail Sale Price (as determined by the taxpayer) or the Standard Price (as defined from time to time by SGT)

• 4.
• Persons involved in activities within the scope of Excise Tax must register for the Tax via the SGT portal prior to 15 June 2019. There is no registration threshold for Excise Tax, therefore any business involved in importing; producing or storing Excise Goods should assess their obligation to register for Excise Tax purposes.

• 5.
• Business that has a stock of goods subject to excise tax and intends to use them for a commercial purpose must submit a Transitional excise tax return declaring the value and quantity of excisable goods held at the time of implementation of the Law.

• 6.
• Any person or business that owns or holds a stock of Excise Goods for business purposes at mid-night June 14, 2019, must conduct an inventory count of those goods, and calculate the Excise Tax due. Businesses must submit a transitional one-off Excise Tax return and pay any tax due, within 15 days of the effective date of the Law, i.e. by 30 June 2019. There is no minimum stockpiling threshold of relevant Excise Goods.

• 7.
• Business must keep all books and records that would enable the SGT to verify the information contained in the transitional Excise Tax return.

Businesses involved in importing, producing or storing Excise Goods should review their obligations and registration requirements immediately. They will also need to consider the review of prices, and assess IT systems to ensure the calculation and reporting of Excise Tax is undertaken accurately, as well as implementing changes in point of sale systems.

Date of article preparation: 10 June 2019

DISCLAIMER:

This document is only for information purposes and should not be construed as an advice. It does not necessarily covers each aspect of the topic with which it deals. You should not act upon the contents of this document without receiving formal advice on your particular circumstances.

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