What is VAT Rate on Education in Oman?
Value Added Tax is an indirect tax imposed on almost all goods and services involved in an economic transaction, including those that are imported into the country. Oman VAT Law has exempted a few supplies, goods, and services from tax implications in order to maintain a stable cost of living. VAT is a known fact in more than 100 countries around the world, however, Oman is the third GCC country to introduce VAT. Since the tax is deducted at every stage of the supply-chain and product life cycle, hence it will have a substantial impact on different sectors of the economy.
The education sector has always been an utmost priority of His Majesty the Sultan’s government with a keen focus on promoting and investing in this area. It is considered as an essential sector-leading towards the transformation, economic diversification, and development of Oman.
What is the role of the Oman government in developing the Education Sector?
Government commitment to develop the Education sector can be witnessed from the fact that it offers business investors incentives including favorable terms for key infrastructure and the financial support for building universities’ campuses and sponsoring students, to encourage and motivate investors towards this sector. Additionally, the government has devised a labor readiness program along with an in-country value initiative to promote spending on local products.
The Education and Higher Education Councils continuously prepare and propose policies and procedures to drive forward the development of the education sector in Oman.
How big is the education sector of Oman?
The literacy rate in Oman is increased from 81% to 94.8% due to the continuous improvement efforts of the government. The education sector has shown tremendous growth from three schools in the country before 1970 to 1,647 public, special education, private and international schools, with a total of 724,395 students, including kindergarteners and preschoolers.
How Education Sector will benefit from Oman VAT Law?
The education sector takes 14% of the total government expenditure, however, a decrease in the budget allocation has been noticed due to the economic crisis the country is facing. Oil revenues have seen a downfall because of the prevailing Covid situation which leads to a decrease in spending, a halt in developmental programs, and reduces the demand for training. Thus, the introduction of VAT will prove to be beneficial for the education sector as it will give the government sufficient resources to continue investing in this sector.
How much VAT is imposed on Educational goods and services?
To ensure that people don’t get discouraged in spending on education, the Oman government has exempted all goods and services pertaining to education. This will prove to be a vital step in fulfilling the vision of Sultan towards a better future.
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