GCC Indirect Tax Weekly Digest
July 14, 2020
GAZT publishes English version of guide on VAT rate change
The Kingdom of Saudi Arabia (KSA) General Authority of Zakat and Tax (GAZT) has published the English version of its guide on the Value Added Tax (VAT) rate change from 5% to 15%. The guide was previously published in Arabic, and the rate change took effect from 1 July 2020.
The guide addresses a wide range of issues taxpayers may face, including the following:
- Input tax deduction
- Transitional rules
- VAT treatment of specific transactions (e.g. real estate, insurance, and contracts with government entities registered for VAT)
- Tax compliance issues arising from the rate change (e.g. relating to tax invoices, tax returns, and accounting systems)
We recommend that businesses familiarize themselves with the guidance, and review existing contracts to ensure compliance. For information about the transitional provisions applicable to existing contracts and suggested action, please refer to our alert.
FTA publishes guides on Excise Tax Clearing Companies
The United Arab Emirates (UAE) Federal Tax Authority (FTA) has published two new guides relating to Excise Tax Clearing Companies (TINCEs).
The Registration and Amendments guide sets out the process for Clearing Companies (TINCOs) to register as TINCEs. The guide is intended to assist users with navigating the FTA portal to complete the TINCE registration form, and provides an overview of the information and documentation required. It also provides guidance on how registered TINCEs can amend any of their registration
The Imports, Release, and Consumption guide clarifies the procedures for suspending Excise Tax upon import, releasing suspended Excise Tax for goods that have been exported, and declaring consumed goods, and provides an overview of the process for completing the relevant declaration forms.
VAT Law progress
The initial steps towards the implementation of VAT have been taken, and it has been widely reported that the Oman VAT Law has been presented to the Shura Council and has been discussed in detail over the last 2 days.
Expedited timelines apply, from our understanding the Shura Council has one month from the date of referral to review the Law, and if approved the Law will be put in front of the State Council. The State Council then has 15 days to analyze and share any approved legislation with the Sultan for signature.
This digest is for information purposes only and should not be construed as advice. It does not necessarily cover every aspect of the topics with which it deals. You should not act upon the contents of this alert without receiving formal advice on your particular circumstances.