As part of Qatar’s plans to reduce the country’s dependence on hydrocarbon resources, the General Tax Authority (GTA) is implementing Excise Tax and taking measures to improve voluntary tax compliance.
Issued under Act No (25) of 2018 and implemented on January 1, the Excise Tax is imposed on certain “unhealthy goods” including tobacco products, alcohol, energy drinks and special purpose goods incurring a 100% tax and carbonated drinks which carry a 50% tax.
The administration of Excise Tax will strengthen Qatar’s economy and help ensure a healthier society. Revenues generated through the Excise Tax will be invested in progressive public interest including infrastructure, healthcare and education safeguarding the future of Qatar for generations to come.
All businesses that import, produce and store or stockpile excise goods will need to account for Excise Tax and file a ‘one-time’ transitional Excise Tax return on the goods they held for business purposes one day prior to January 1 this year.
With no threshold for transitional Excise Tax return filing, any business that has excise goods in their stocks will need to file transitional Excise Tax returns no later than January 31. Businesses must pay the Excise Tax no later than 30 days after filing the transitional Excise Tax return.
Businesses that import or produce excise goods or businesses that wish to operate a tax warehouse must register with the General Tax Authority; keep accounting books and records; file tax returns and pay the tax due on a quarterly basis. There are no thresholds for Excise Tax registration.
Businesses that only hold a stock of excise goods for business purposes such as hotels, convenience stores, tobacco shops, etc are not required to register with the General Tax Authority for Excise Tax purposes, but they are still liable to pay a one-time transitional Excise Tax returns.
Businesses may also apply for a tax warehouse licence. A tax warehouse is a location in which an authorised person (warehouse keeper) is permitted to store or produce excise goods under an Excise Tax suspension arrangement. The warehouse keeper will be liable for the Excise Tax due on any excise goods leaving the tax warehouse.
Businesses should ensure fulfillment of compliance obligations. The General Tax Authority reserves the power to conduct assessments on taxable persons and may subsequently impose penal measures which may entail imprisonment for a period not exceeding one year and/or a fine not exceeding three times the tax amount payable as per Act No (25) of 2018 on Excise Tax Law Articles 16 and 18.
More details about the Excise Tax registration and one-time transitional Excise Tax return filing and payment can be had from the General Authority of Customs website www.customs.gov.qa.
