488 food commodities exempted from VAT

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Muscat: The Tax Authority has issued a decision identifying the food commodities that will be subject to value-added tax at a rate of zero per cent.

The decision is based on the Value-Added Tax Law issued by Royal Decree 121/2020 and decision2021/2 specifying food commodities subject to value-added tax at a rate of zero per cent.

The Tax Authority has identified 488 food commodities that are exempt from value-added tax, including vegetables, fruits, legumes, grains, dates, spices, oils, fish, red meat, and poultry, in addition to milk, cheese, tea, coffee, sugar, salt, and juices without added sugar or sweetening materials.

The government had previously announced 93 basic food commodities exempt from value-added tax, but the list of these commodities was expanded to 488 food commodities within the package of social protection initiatives issued on Thursday.

The value-added tax will be introduced in the Sultanate from April 16.

The government has also decided to bear the cost of the VAT charged against electricity and water services for all citizens who own two accounts or less of the residential category. This includes families that were previously eligible for government support for the two services.

It will increase the volume of subsidised fuel to be consumed by holders of the National Subsidy Card from 200 litres to 400 litres per month. The government bears the cost of the VAT towards that amount so that it remains at the same subsidised price of 180 baisa per litre.

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