- Law No. 157 of 2025 amended the VAT law, raising VAT on building and construction activities from 5% to 14%.
- Decree No. 418 of 2025 details implementation procedures, contract impacts, tax obligations, and deduction rules.
- For ongoing contracts before 18 July 2025, VAT is calculated on 36% of the invoice value at 14%, with no input VAT deduction allowed.
- If the main contractor remits VAT, subcontractors are exempt if a certificate is provided.
- New or renewed contracts are fully subject to 14% VAT, with input VAT deduction permitted, and the responsible party must remit VAT at the new rate.
Source: taxathand.com
Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.
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