Excise tax on select goods come into effect starting today

Supermarkets and retail stores in Muscat, and indeed other cities around the Sultanate, witnessed an increase, albeit modest, in the sales of certain types of excisable merchandise over the weekend, ahead of today’s entry into force of a new Excise Tax on select categories of consumables deemed harmful to health and the environment.

With effect from midnight yesterday, the new levy went into effect on the following goods designated as subject to Excise Tax: Tobacco and tobacco derivatives (100 per cent tax), Carbonated drinks (50 per cent), Energy drinks (100 per cent), Special purpose goods [Alcohol and Pork products] (100 per cent).

The additional tax stems from Royal Decree 23/2019 promulgating the National Excise Tax Law issued by His Majesty the Sultan on March 13, 2019, and which comes into effect today, June 15, 2019.

In the run-up to today’s entry into force of the new tax, cost-conscious consumers have scrambled to stock up on their personal supplies of mainly tobacco, energy drinks and special purpose goods.

Over the weekend, pubs and licensed eateries in the city also reported a significant jump in patrons eager to make the most of lower prices on their favourite tipples. Many outlets in luxury properties in the city drew capacity turnouts.

“The tax is self-assessed and businesses will submit their Excise Tax returns and pay the tax due periodically to the SGT. As a consumption tax, the Excise Tax is ultimately borne by the final consumers — but collected earlier in the supply chain. Importers, manufacturers and, in certain cases, other agents in the supply chain are liable to register for the Excise Tax, submit periodical returns, and pay the Excise Tax due to the SGT, and maintain supporting documentation,” the tax department explained in a detailed guide published last week.