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Bahrain Exempts 94 Items from VAT

A Bahraini man shops at a local supermarket in Isa Town south of Manama, Bahrain, November 28, 2018. (Reuters)
A Bahraini man shops at a local supermarket in Isa Town south of Manama, Bahrain, November 28, 2018. (Reuters)
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Bahrain Exempts 94 Items from VAT

A Bahraini man shops at a local supermarket in Isa Town south of Manama, Bahrain, November 28, 2018. (Reuters)
A Bahraini man shops at a local supermarket in Isa Town south of Manama, Bahrain, November 28, 2018. (Reuters)

Bahrain exempted on Tuesday 94 items from the Value Added Tax (VAT).

Minister of Finance and National Economy Sheikh Salman bin Khalifa Al Khalifa affirmed that the Ministry will take all necessary measures to ensure that VAT is not applied on zero-rated goods and services - 94 basic food items in addition to goods and services that support essential sectors - in line with the VAT Law and its Executive Regulations, reported Bahrain’s news agency (BNA).

The minister praised the King’s directive to review the mechanisms of applying VAT during its trial period, which takes into account citizens’ needs through the exemption and non-application of VAT on basic goods and services.

He underscored the ministry’s efforts aimed at bolstering transparency by dedicating resources towards raising VAT procedural and legal framework awareness.

He noted that all registered businesses are required to clearly display their VAT registration prior to levying the 5% tax.

All registered businesses are also legally required to display the final prices of all goods and services - inclusive of tax.

The Tax Invoice should include the full price, followed by the total price to be paid and the amount of tax charged therein as it is a violation to mislead consumers.

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Lebanon’s Struggling Economy Slides Toward Full Recession

The Jousieh crossing between Lebanon and Syria following an Israeli strike on October 25. (AFP)
The Jousieh crossing between Lebanon and Syria following an Israeli strike on October 25. (AFP)
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Lebanon’s Struggling Economy Slides Toward Full Recession

The Jousieh crossing between Lebanon and Syria following an Israeli strike on October 25. (AFP)
The Jousieh crossing between Lebanon and Syria following an Israeli strike on October 25. (AFP)

The ongoing Israeli war on Lebanon has led to significant economic losses estimated between $10 billion and $20 billion.

This range reflects the difficulty in accurately assessing the damage amid Israel’s ongoing military operations, including airstrikes and ground attacks.

The destruction of homes, infrastructure, and farmland has contributed to a state of uncertainty, along with an unprecedented wave of displacement affecting many families.

Experts agree that reliable economic data is hard to obtain while the conflict continues.

Reports from the Ministry of Health and international organizations said nearly 3,000 people have been killed and around 15,000 injured, mostly civilians.

Additionally, about 1.4 million people have been displaced from their homes, representing roughly a quarter of Lebanon’s population.

Growing economic crisis ahead

The war came at a time when Lebanon’s economy was already struggling after five years of crisis.

According to Mohammad Choucair, head of the Economic Bodies Association, the situation is worsening rapidly, threatening serious economic and social consequences.

Current estimates suggest that direct losses from the conflict could reach between $10 billion and $12 billion, impacting various sectors.

As the war continues, key sectors like tourism, agriculture, and trade are experiencing a sharp decline in business activity.

Many small and medium-sized enterprises are being forced to close or suspend operations due to direct damage from attacks, reduced consumer demand, and disruptions in trade and supply chains caused by the influx of displaced people.

International financial institutions are warning that the ongoing Israeli attacks could continue for several more months, possibly lasting until mid-2025.

The Institute of International Finance (IIF) forecasts a 7% contraction in Lebanon’s GDP by the end of this year, followed by a 10% decline next year.

This would bring the total economic decline to nearly 60% from the peak GDP of around $53 billion recorded at the end of 2018.