Bahrain government may reconsider start date of VAT

Over the past few days, there has been a lot of speculation leading up to the implementation of Value Added Tax (VAT) in Bahrain, as to whether it will be formally introduced on 1 January 2019 or would be postponed for up to a year.

Yesterday the Bahrain Parliament voted in a proposal to postpone the introduction of VAT, however, this is yet to be formally passed in law. The matter has been referred urgently to the Cabinet meeting on 31 December where it will be further debated.

By all accounts, we are aware that the VAT registration system is up and running and several hundred Bahraini companies have registered for VAT in anticipation of a 1 January 2019 start.

Therefore, from a preparedness perspective on the part of the National Bureau for Taxation, there does not appear to be any suggestion that an administrative delay is required.

Our advice to clients remains the same; continue with your implementation efforts – especially around invoicing and pricing changes that may be required for your systems in the anticipation that VAT will be introduced in the New Year.