With respect to the anticipated VAT implementation in the sultanate, EY Oman conducted a survey to assess the current state of VAT awareness across the Omani business community.
‘More than half (52 per cent) of the respondents indicated that they understand the challenges associated with VAT. The survey respondents represent a cross-section of industries including large corporates, state-owned organisations as well as small, micro and medium enterprises’, EY said in a statement.
The survey results indicated that the businesses are aware that VAT implementation projects have long lead times. However, the results also highlighted that most businesses are at an early stage of preparation as indicated by 49 per cent of respondents not having begun reviewing their contracts for VAT risks.
One of the important aspects of the survey is that only one among four respondents believes that the implementation of VAT could lead to an escalation of cost.
‘Twenty-four per cent of businesses indicated that they are concerned VAT will lead to a cost escalation as a result of suppliers increasing their prices. Businesses were also aware of the implementation and compliance costs related to VAT’, EY said.
Another important finding of the survey is that most businesses indicated they expect the finance function to be the most impacted. ‘Most businesses expect their finance team to manage their VAT reporting. This strategy would require the finance team to be provided with sufficient training with clearly defined roles and responsibilities. Furthermore, certain industries such as financial services and real estate may require specialist knowledge’, the statement said.