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Common Excise Tax Agreement Of The Gcc

The excise duty is expected to be introduced in the last quarter of 2017. The United Arab Emirates is in the process of enacting tax laws, including excise legislation, that will come into force during this period. It was in 2015 the price of oil and oil from the Gulf countries arrived at its much lower price. To meet future needs, the representative of the GCC countries approved the VAT contract. They reached this agreement in 2016. It is not oil and gas that has completely wiped out the economic growth of the GCC countries, the fact is that many countries have started to use non-renewable resources. For example, developed countries like the United States have started producing their own oil and oil, so it will be fierce competition for the Gulf countries, because they were the only oil and gas distributors in the whole world. With this in mind, the Gulf countries have planned for the future and have contributed to the future growth of their nation. But in 2015, they faced a budget deficit. To overcome this deficit, they recognized the need for a new source of income and thought about taxes.

That is why, in 2016, each representative of the GCC countries signed the VAT agreement. VAT is VAT by the conclusion of this agreement, by which the GCC countries have begun to collect certain goods and services at a rate of 5%. Health and education are exempt from VAT. Now, GCC people have to pay a 5% VAT on food, cars and other entertainment. Excise duty: this is an indirect tax levied on goods harmful to human life and property, as well as to the environment as a whole. In order to prevent the use of these harmful products, the GCC countries decided to adopt the excise duty by signing the excise duty agreement. To date, VaE, KSA, Bahrain and Qatar have 100% imported excise duties on manufactured tobacco, 100% energy drinks and 50% soft drinks. The excise duty, called the “sin tax,” is a form of indirect tax applied to certain goods that are typically harmful to human health or the environment. As part of a joint effort to reduce the consumption of unhealthy and harmful products, gcc countries have agreed to introduce excise duty as part of the GCC`s joint excise duty agreement. Under the Charter of Arab States of the Gulf Cooperation Council (GCC), a policy aimed at strengthening regional cooperation, GCC member states have agreed to sign the single excise duty agreement, which is a tax on certain products considered harmful to health.

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