VAT in GCC
Sector Impact > F&B
The F&B sectors includes a combination of goods and services which may fall under different tax rates depending on the nature of the items.
- Imports will attract VAT under the Reverse Charge Mechanism unless certain ingredients are exempt from VAT. Essential and staple food items is expected to be exempt from VAT.
- Outsourced manpower, which is quite common in this sector, will be subject to VAT but can be claimed as Input tax credit.
- All sales will be charged at the standard 5% rate including any service fee or delivery charge.
The final impact of VAT on F&B as revealed by the government will be as follows:
|Impact on F&B||VAT Rate|
|Food and Bevarages||5%|
Sector VAT News Update
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Sector impact analysis is provisional based on the GCC Draft and may change when the country issues the relevant VAT laws.