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Reduction of VAT; extended tax deadlines and waiver or reduction of penalties (COVID-19)

The Ministry of Finance on 24 August 2021, released several relief measures in response to the coronavirus (COVID-19) pandemic.

These relief measures include a reduction of value added tax (VAT), an extension of tax filing deadlines and a waiver or reduction of penalties.

  • Two-year extension of reduced VAT rate of 7%
    • The Cabinet approved the Ministry of Finance’s proposal to maintain the reduced VAT rate of 7% for another two years.

    • The reduced 7% VAT rate will be inclusive of local taxes and applicable for VAT liabilities incurred from sales of goods, service provisions and import transactions from 1 October 2021 to 30 September 2023.

  • Extended tax return filing and tax payment deadlines
  • Waiver or reduction of penalties and fines

Source KPMG


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