Bahrain confirms 2018 VAT
- Mar 1, 2017 | Richard Asquith
Bahrain has confirmed the introduction of VAT from 1 January 2018. Along with the other five states of the GCC, Bahrain will introduce VAT at 5% to help compensate from the losses on oil duties.
Bahrain will exempt real estate, transport education and health services from the new indirect tax regime. The supply of oil and gas products and transport services will be nil rated, meaning VAT incurred in the cost of production may be reclaimed. It is likely that financial services will be exempted.
The VAT registration threshold will be $100,000 per annum. There will also be a voluntary option for VAT registration for small companies.
As with the European Union, the supply of goods and services to VAT registered businesses in other GCC states will be zero rated, and subject to the reverse charge.