As VAT stands approved by the Majlis Ash’shura and is now waiting the accent of the State Council who has until the 6th of August to do so, the VAT law is likely to have a Royal Decree implementing it by as early as September this year as predicted by Imran Mushtaq, Indirect Tax Director- PwC Middle East. This was quoted by him at a recent Webinar hosted by PwC on the theme, ‘Tax and Legal Updates: COVID-19 Impact and Future Challenges’. Mushtaq further stated that the timing for rolling out VAT looks critical considering the macroeconomic state of Oman aggravated by the pandemic and worsened more by depression in Oil prices creating a void in the Country’s Fiscal Deficit and credit rating.
The wide fiscal deficit is likely to reach around 16% of Oman’s GDP as per International Monetary Fund in 2020. Scott Livermore, economic advisor at ICAEW and Chief Economist at Oxford Economics predicts that introduction of VAT at the rate of 5% could generate about OMR300m or $780m. This might coverup 4% of the estimated deficit making it a welcoming news for its critics and the Tax Authorities.
Source: Oman Observer
1 Like
885
