Introduction to the Excise Tax in Oman has been saved
Introduction to the Excise Tax in Oman
As you may be knowing, the Sultanate of Oman being one of the signatories to the GCC Excise Tax Treaty, has decided to introduce the Excise Tax on certain harmful products (such as tobacco, energy drinks and soft drinks) with the intention of decreasing its consumption and as we write this, we understand that the Ministry of Finance is prepping for its implementation.
At this end, the draft Excise law is already approved by the Majlis A’Shura and State Council and is on the final stage for the ratification by His Majesty.
Impact of the Excise Tax:
This new tax will primarily impact all businesses that manufacture/import/trade/stock soft drinks, energy drinks or tobacco products (including the parties involved in the supply chain). This clearly means that the businesses (such as retailers, hotels, restaurants, etc.) which are simply holding the stock of these products on the date of introduction of new tax could also be significantly impacted. With the introduction of the Excise Tax in the three GCC countries - one can already anticipate what this tax entail for you and how it can impact you?
Actions to take:
Businesses need to act quickly, to:
- Understand and evaluate the transitional impact (on stock of these products, cash flow, supply chain processes, contracts, etc.);
- Evaluate the effect of Excise Tax introduction on IT systems/ERP (including changes required in the PoS);
- Plan and arrive at the strategic corporate decisions;
- Closely monitor the Excise Tax developments.
Deloitte is well-placed to provide comprehensive Excise Tax consultancy services to businesses in Oman i.e. to navigate through this new tax and help you analyze the impact your business may have upon its introduction. Also, we can help you get to the roots of complex issues quickly and bringing the issues to the attention of the tax authorities with our ongoing professional relationship.