GCC’s Tax Revenues to Plummet 20 Percent Due to COVID-19

GCC’s Tax Revenues to Plummet 20 Percent Due to COVID-19

GCC countries could lose up to 20 per cent of tax revenues this year due to the impact of coronavirus and the resulting lockdowns on their economies. 

However, a decline in tax revenues in Saudi Arabia, the region's largest economy, could be offset with the tripling of value-added tax (VAT) that began on July 1. 

GCC countries levy a corporate tax in the range of 15 per cent to 85 per cent on oil and gas companies. The impact of plummeting oil prices in addition to the coronavirus crisis will also have a domino effect on corporate tax collections, says Nimish Goel, partner at WTS Dhruva Consultants. 

"In the GCC, sectors like e-commerce and retail have witnessed exponential sales whereas other sectors have been badly affected due to the pandemic. With an overall contraction in business