Gulf tax revolution: Qatar approves VAT bill

Qatar has approved a bill for the implementation of VAT and other taxes in 2018. The rest of Gulf countries will also introduce measures of this type.

The Qatari government has recently approved a proposal for legislation to introduce the VAT tax and another rate for certain products such as luxury goods or junk food, according to Doha News.

With this measure, Qatari authorities begin to implement the agreements signed at the international level with the rest of Gulf countries in the framework of the Gulf Cooperation Council (GCC), in an attempt to increase the level of state revenue to counteract the decline Oil prices.

In this regard, the GCC met in Bahrain to coordinate this fiscal reform in the countries of the region; A reform that means a further step in the economic integration of the Gulf, highlights the Arab News.

The selective tax will apply not only to fast food and luxury items but also to goods that are harmful to human health or the environment such as alcohol, tobacco or sugary drinks.

Although no specific date has yet been set for the entry into force of these changes, with respect to VAT the reform must be complete by 2018. The government has encouraged companies, meanwhile, to adapt to this future fiscal framework , As they will have to cope with new compliance costs relating to accounting, inspection, audit and control.

The most immediate effect of this reform will be the rising cost of living in Qatar. Thus, the International Monetary Fund (IMF) has forecast inflation growth of 3.1 points for 2018, from 2.6% to 5.7%.

The introduction of VAT and other taxes is part of another broader set of fiscal measures that the Qatari government is developing to adapt its tax and commercial structure to international standards; A process that we have already highlighted in our blog other initiatives such as the approval of a new arbitration law.

In Del Canto Chambers we are specialized in commercial law and from our office in Doha we advise those companies with interest in establishing themselves in this country. You can contact us at

Del Canto Chambers’ Editorial Board

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