GCC Indirect Tax Weekly Digest
May 13, 2019
KSA GAZT publications
Islamic Finance VAT guide (English)
The guide provides further clarity on the VAT treatment of Islamic Finance products and the transactions such products entail. Sections are included for a number of Islamic Finance products, including (but not limited to) Ijarah, Murabaha, and Musharaka, with a description of the product and the relevant VAT treatment identified.
One feature of some Islamic Finance products is the transfer of ownership of goods from one party to another without the intention of permanently passing on the ownership of the goods to the recipient. The guide explains the special treatment of such temporary transfer of ownership when it occurs as part of the structure of an Islamic Finance product, in addition to providing details on the evidence requirements for proving the eligibility of applying the special treatment.
NBR adds Tourist Refund Scheme section to website
The Bahrain National Bureau for Revenue (NBR) has added a section on the Tourist Refund Scheme (TRS) to its website.
The page summarizes the eligibility criteria for tourists to obtain a refund, the export validation requirements that must be shown at the airport on departure, and the list of goods which are not eligible for the TRS.
A link is also included to the TRS operator’s website, which provides further details on the TRS in Bahrain.
The TRS is intended to allow visitors to Bahrain to recover a percentage of the VAT paid on eligible purchases made in Bahrain. A similar system was introduced in the United Arab Emirates (UAE) in 2018.
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.