GCC to exempt oil from value added tax

Press sources revealed that the GCC countries exempted oil and its derivatives as well as gas from the value added tax, and left it free for each country to subject or exempt four sectors from the imposition of the tax of 5%, namely: education, health, real estate and local transport.
 
In accordance with the GCC unified value added tax system and regulations, each member state shall be permitted to exclude both the government agencies it specifies, charities and public benefit institutions, as determined by each state, and the unregistered farmers and fishers, and companies exempted by agreements to host international events and the citizens of the member state in the construction of their own homes for the purpose of paying the tax upon receipt of goods and services in that state.

All foodstuffs are subject to the basic tax rate, with some food commodities on the list of uniform commodities exempted, medicines and medical equipment are exempted from tax-exempt goods, but according to unified regulations. The exemption from value added taxes includes the movement of goods and passengers from one member state to another, the supply of transport-related services, the international transport of goods and passengers to and from the GCC region, and the supply of transport-related services.

The tax exemption includes financial services by banks and financial institutions. Banks and financial institutions are entitled to recover the input tax on the basis of recovery rates determined by each country.

Russian Energy Minister Alexander Novak said a decision to extend the global agreement to cut oil production in the second half of the year had not yet been taken, but it would be discussed with OPEC on May 24. He said during a visit to Tokyo that Russian oil production cuts, amounted to 250 thousand barrels per day, will reach the target of 300 thousand barrels per day by the end of April, pointing out that the oil market is improving in light of OPEC production cuts and some non-OPEC members, including Russia, reducing the surplus supply, which has pushed prices for years.