Bahrain has decided to enter into the VAT regime following the path of its GCC co members Saudi Arabia and UAE. Its parliament has approved for a 5 percent value-added tax (VAT) in the kingdom from January 1 2019.
The VAT law in Bahrain is considered to be more consumer friendly as per VAT experts while comparing to the VAT implemented in other GCC countries.Adding to it, the recent announcement by Ministry of Finance regarding VAT implementation has been a big relief for Small and Medium Enterprises.
The main points are –
1. First phase of VAT is applicable only to firms with annual sales of BHD 5 Million or above.
2. 94 Basic goods and services are exempt from VAT.
3. MOF will conduct series of workshops to ensure companies and owners are ready for VAT implementation.
The firms above the prescribed threshold need to register with National Bureau for Taxation (NBT), which is the entity in charge of managing the tax.
Applications will be received until January 1, 2019 – said Rana Faqihi, the Assistant Undersecretary for Development and Revenue Policies