Value of Imported Goods in Oman

Yarab A | Updated on: January 10, 2022

The imported goods and services will be taxable at 5% VAT in Oman. Except for a few types of supplies such as zero-rated, exempt and few notified supplies, all imported goods will be taxable. Unlike domestic supplies, VAT on imports needs to be paid on a reverse charge basis, meaning the importer has to pay VAT to authorities. It is usually paid when clearing the goods from customs or at the time of filing a VAT return if a business has opted deferred payment scheme.

No matter when you pay, it is essential to understand the value of the imported goods on which VAT is charged.

Value of imported goods in Oman

After considering the various costs and duties associated with the imports, the value of imported goods is arrived. As stated in Oman VAT regulations, the value of imports will consist of customs value determined as per customs law, other taxes, fees and expenses related to the import. It will be applied even if the goods are exempt from customs duty.

VAT Payment on Import of Goods and Services in Oman

Value of Supply in Oman VAT

Below are the different components that form part of the taxable value of imported goods in Oman:

Customs value determined as per Customs Law
Excise tax and custom duties
All fees levied by the customs or any other party on the import
Transportation, packaging, storage, stacking and insurance fees

It is important to note that the taxable value of imported goods does not include the discount given on the import date. In other words, the discount will not affect the value of the goods unless the customs value of the goods is adjusted due to this discount.

In determining the taxable value of imported goods, first, the customs value of imported goods is ascertained. Next, customs and excise duty will be levied on the goods as applicable. Then, all other charges such as transportation, packaging, storage, stacking and insurance will be added to the taxable value. Any fees leveied by customs or any other party will also be included in the taxable value of imported goods.

The standard VAT rate will be charged on the final value arrived after adding all the above components.

Value of Goods

+Customs Duty

+ Excise Duty

+Value of Fright and Insurance

+ packaging, storage, stacking and any other fees

Example of import value calculations

Import value	Amount
Value of goods (Customs value)	2,20,000
(+) Customs duty at 5% (2,20,000*5%	11000
Total value of import	2,31,000
(+) Excise duty at 50%	115500
Total value of import after excise duty	3,46,500
Packaging charges	500
Total taxable value	3,47,000
VAT at 5%	17,350

In the above case, the value of import goods for VAT includes goods value + customs duty + excise duty and packaging charges.

For business, it is essential to know that the value of import is not just the cost of goods but also includes various costs associated such as customs duty, excise duty and other charges/fees related to imports. Another aspect related to imports that businesses need to note is input VAT deduction. Oman VAT law allows companies to claim input deduction on the imports by declaring the value in the respective field of the VAT return form. Using VAT software will help you manage Input VAT deduction and filing VAT returns.

TallyPrime, a VAT enabled business management software helps you account and manage different nature of transactions, including the imports. Right from accounting the import transactions to tracking the related input VAT to filing VAT returns, makes TallyPrime a complete and compliant VAT software in Oman.

Read more on Oman VAT