GCC VAT – A Reality?


Implementation of VAT is the hot topic of discussion among GCC nations including Bahrain, Kuwait, Oman, Qatar, Saudi Arabia and the United Arab Emirates for the last few years. The income of governments in these countries have come down considerably due to fall in oil prices. Therefore, GCC countries came together and decided to introduce Value Added Tax to increase revenue for the governments in this region. The members of GCC confirmed that they would introduce VAT between 2018 and 2019 and Saudi Arabia and UAE have already implemented in it from January 1, 2018. Finance Ministry of Oman has confirmed VAT would be a reality in the country from October 2018 and other countries would follow suit soon.
The rate of VAT agreed among GCC is 5% and the member countries can decide on the taxable and non taxable goods and services and can document legislation locally. In general, food, medicine, education and financial services would remain tax free. Gulf nations are sources of financial activities and have great amount of transactions being conducted daily worldwide and therefore, need to clarify and carefully choose the financial services that are taxable and non taxable. More inputs on these insights will come into light in the coming days as more countries in GCC would implement VAT.
Most importantly, businesses in GCC countries need to be VAT ready for error free accounting and management of all department of their operation of business. A cloud based VAT compliant ERP system is the best solution for businesses here to be fully integrating their business with VAT. Understanding this greatest requirement of businesses here, QUALITY HORIZON Pvt. Ltd. under the leadership of Ganesh Sawant, Solution Architect, and Aby Abraham – Marketing Head and Naiyar Raza – Technical Head has introduced GCC VAT ERP Solution for SME’s in this region. It is a custom developed ERP solution for companies in GCC countries. Its variations in other VAT implemented nations are very popular. A monthly subscription to our ERP software will make you VAT ready.

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