E-commerce subject to VAT in Oman

E-commerce subject to VAT in Oman

MUSCAT - New guidelines issued by the Oman Tax Authority confirm the inclusion of the ecommerce sector, currently expanding at an exponential rate, within the purview of the country’s Value Added Tax (VAT) regulations.

Consequently, a wide variety of goods and services supplied via electronic means, such as websites, electronic platforms, social media stores and networking sites and other electronic apps, are now subject to Oman’s VAT framework.

The Omani e-commerce market, valued at $2.19 billion in 2020, is expected to reach $6.52 billion by 2026, registering a CAGR more than 20 per cent by 2026, according to Japan-based Shibuya Data Count, a specialist in market research. The sector grew robustly during the pandemic phase and is projected to expand dramatically on the back of the country’s digital transformation, rollout of 5G telecom services, rapid uptake of digital payment options, and the emergence of thriving online marketplaces.

The Tax Authority’s recent guide on the application of VAT to ecommerce – also known as electronically supplied goods and services – makes it obligatory for suppliers, who engage in e-commerce activities but do not have a place of residence in the Sultanate of Oman, to register for VAT if they are required under the tax