Boon or bane? Oman gears up for sin tax

Muscat - 

Effective from Saturday, June 15, the sultanate will join the list of other GCC states in levying 100 per cent tax on alcohol, tobacco, energy drinks, pork meat and 50 per cent on carbonated drinks. 

The registration for the Excise Tax dubbed commonly as the sin tax, is bound to go live on the set date, confirmed Sulaiman bin Salim al A’adi, director general of survey and tax agreements and head of the excise tax working group at the Secretariat General for Taxation in a statement.

While the tax will affect the sultanate’s residents and businesses alike, it is also being welcomed by a large group of people.

In an online poll conducted by Muscat Daily, 53 per cent of people agreed that the increased tax on tobacco, energy and soft drinks and alcohol will reduce the use of these products. Many youngsters also feel that the high prices will impact their choices. “I needed to reduce and cut down on sugary drinks and this taxation comes as free motivation for me,” said Joshua Andrews, a resident of Muscat.

“It’s an obvious blessing as we all know the disadvantages of overconsumption of sugary drinks and the likes,” said Juliet Shibu, a student of Indian School Muscat.

Mohammed al Balushi too feels it is a positive move as it will not just unlock new sources of income for the government, but also rein in people’s addiction to such harmful products. “The consumption of carbonated and energy drinks among the children and youth in Oman is very high. With this tax maybe more people will ask for plain water.”

However, many also feel that such taxes will not affect the affluent classes as much as the lower income groups. “I feel that only folks with higher income will be able to afford these products,” added Juliet.

Soft drinks are a staple of blue-collar workers and the taxation is going to affect them more, said Keith Watson, an interior designer. “People of middle income and lower income groups will think twice before buying these taxed products to avoid a dent in their savings.”

This can also be an opportunity to change habits, said a coffee shop owner in Ruwi. “People will not want to buy a carbonated drink especially when the hike is 50 per cent,” he said adding, “This may be a good time to advocate fresh juices.”

It might be easier to give up on sugar addiction but tobacco consumers have a different story. “It is going to be an expensive habit,” said Salim, a media professional and a chain smoker.

Alcohol, which will also be taxed at 100 per cent, is going to be an expensive affair for consumers who already pay a hefty price at licensed restaurants. “It will be expensive to enjoy a bar experience in Oman,” said an American residing in Oman.

“Tourists will have a hard time too if they have to pay a higher price for a holiday drink,” she added. In Europe around 11 countries including the UK, Ireland, France and Portugal imposed the ‘sugar or health tax’ last year onwards.

The trend gained momentum in the Middle East in the past year with Saudi Arabia and the UAE slapping excise tax within a range of 50 to 100 per cent on cigarettes, tobacco, energy drinks and carbonated drinks.

Similar content

muscat daily recycle