Kuwait Keeps VAT Off the Table: No Adoption in the 2026–2030 Fiscal Plan

Summary

• Kuwait’s latest four-year (2026–2030) fiscal plan omits VAT, meaning implementation is unlikely before 2028 at the earliest—leaving Kuwait and Qatar as the only GCC states without VAT. [vatupdate.com], [taxinme.com]
• The National Assembly has repeatedly stalled VAT bills over cost-of-living concerns, aided by Kuwait’s large sovereign wealth fund and lower budgetary urgency than its neighbours. [taxinme.com]
• Instead of the 5% GCC-agreed VAT, Kuwait is favouring excise duties on tobacco, luxury goods and possibly sugary drinks, plus higher customs levies, to diversify revenue. [fiscalsolu…ions.co.uk]

Article

Kuwait has again deferred Value Added Tax, with its 2026–2030 fiscal plan making no provision for implementation—effectively ruling out VAT before 2028. Although Kuwait signed the 2016 GCC Unified VAT Agreement committing members to a 5% harmonised regime, it has never enacted domestic legislation, unlike Saudi Arabia (15%), the UAE (5%), Bahrain (10%) and Oman (5%); only Kuwait and Qatar remain outside the VAT net. Analysts attribute the delay to a historically independent and contentious National Assembly, where multiple VAT bills have stalled amid cost-of-living concerns, reinforced by Kuwait’s substantial sovereign wealth and weaker fiscal pressure to diversify away from oil. Rather than a consumption tax, Kuwait is leaning on increased customs duties and excise levies—on tobacco, watches, jewellery, luxury cars and yachts, potentially extending to unhealthy foods and sugary drinks—to raise revenue in the interim.

Sources

• VATupdate
• Fiscal Solutions
• TaxINME

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