Gulf Co-operation Council publishes VAT treaty

31 May 2017

The Gulf Co-operation Council (GCC), which consists of Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates, has published a VAT treaty which outlines its proposed January 2018 common VAT regime.

This treaty will outline the structure of the harmonized VAT regime across all six states, and will be used as a guide for the states to implement their own local VAT legislation.

The treaty is not legally binding on the member states and some of the key features can be seen below:

  • Since the GCC will constitute a free trade zone, the treaty will allow businesses in separate states to sell goods and services to each other VAT free, this will mirror the current concept applied in the EU
  • Businesses can distance sell goods to consumers in other member states subject to thresholds
  • The standard VAT rate will be 5%
  • Imports will be subject to VAT at clearance in the country of arrival; exports will be exempt
  • VAT derogations where states can choose to tax on such things as Health and medical supplies and foodstuffs, but this list must be agreed between the states.
LATEST NEWS

Belgium to cut e-book VAT rate from 1 January 2022

From 1 January 2022, the Belgium tax authorities have confirmed that the VAT rate on the sale of e-books, e-manuals, e-newspapers, and e-magazines sold online...

SEE MORE
LATEST NEWS

Ukraine to apply VAT on digital services from January...

From 1 January 2022, Ukraine will impose VAT at 20% on the sale of e-services to local consumers by non-resident businesses.  At present, non-resident...

SEE MORE
LATEST NEWS

Does a UK e-commerce business need an IOSS...

From 1 July 2021, the EU’s new e-commerce VAT reforms will be introduced allowing sellers to no longer pay import VAT at clearance on low-value consignments...

SEE MORE

Gated Content

The following email providers are not accepted: gmail, hotmail, yahoo. Please use proper company email.