Oman to introduce 5% VAT in April

Oman to introduce 5% VAT in April

Cash-strapped Oman is planning to introduce a 5 per cent value-added tax in April, following the lead of Gulf neighbours.

Essential food items, medical care, education and financial services will be exempt from the planned levy, according to a royal decree detailing the tax on Monday.

Oman, the biggest oil exporter outside OPEC, was among the more vulnerable economies in the six-nation Gulf Cooperation Council even before it was lashed by falling crude prices and the coronavirus pandemic.

Its budget deficit as a share of gross domestic product is anticipated to be among the highest in the region, according to the International Monetary Fund.

The United Arab Emirates and Saudi Arabia, also clobbered by the drop in oil prices, imposed a 5 per cent VAT in 2018. Saudi Arabia tripled its tax this