The Bahrain Cabinet has approved an increase in the standard rate of VAT from 5% to 10% with a proposed effective date of 1 January 2022. The announcement comes in response to the impact COVID-19 has had on the Bahrain economy and is aimed at stabilising the Fiscal Balance for Bahrain.
Businesses may have taken VAT cost less seriously as errors at 5% or the inability to claim input VAT may have not had a material impact on their finances. However, with the rate set to double, VAT should become a material consideration for most businesses – with VAT at 10%, errors and the inability to claim input VAT is likely to have a significant impact on businesses.
Source KPMG
Latest Posts in "Bahrain"
- Bahrain Updates Global Minimum Tax FAQs and VAT Deregistration Manual for Enhanced Compliance
- Bahrain Updates DMTT FAQs and VAT Deregistration Guidance for Enhanced Tax Compliance
- NBR Releases Updated VAT Deregistration Manual with Step-by-Step Guidance
- MP Proposes VAT-Free Zone Near Khalifa Port to Boost Re-Export and Ease SME Cash Flow
- Bahrain Parliament to Debate VAT Exemption for Social and Youth Associations
