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The tax neutrality principle has not been fully realized in applications of VAT in GCC

VAT neutrality is a key principle of the VAT system, ensuring that foreign businesses are not disadvantaged or advantaged compared to domestic businesses. However, in certain cases, such as with life reinsurance services, tax neutrality may be breached due to different tax burdens for foreign and local suppliers. The standard rate VAT on services supplied to non-residents could be a solution to achieve tax neutrality.

Source Ahmed Sadek


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