Excise tax to take effect on December 30

Manama, Dec. 27 (BNA): Bahrain will start levying the excise tax on specific harmful goods on the 30th of December. "Under law 40 of 2017, the excise tax will be applicable to carbonated drinks at a rate of 50%, and energy drinks and tobacco products at a rate of 100%", said the Ministry of Finance. The Gulf Cooperation Council (GCC) summit which was held in Riyadh in 2015 agreed to implement the selective tax. The excise tax aims to encourage citizens to opt for healthy products, reduce the consumption of harmful goods, enhance social awareness and alleviate the financial burden resulting from the treatment of diseases. Under law 40 of 2017, traders wishing to import or produce harmful goods subjected to the excise tax are required to submit an application in this regard by January 15, 2018. "The ministry will finalise the registration pending completion of terms and regulations stipulated in the law", said Assistant Undersecretary for Public Revenues Development Rana Ibrahim Faqihi. In a statement today, she said that violations of excise tax law or tax evasion would incur administrative fines and criminal penalties. Under the law, those who fail to submit tax statements to the Ministry of Finance or pay the required fee within the deadline would be fined 5% to 25% of the overall value of the excise tax, in addition to the payment of the fee. Violators who prevent the ministry’s employees from performing their duties, refuse to supply them with the required information or break the excise law provisions would be fined a maximum BD5,000. In case the violation is repeated within three years, the competent authorities may double the administrative fine and / or revoke the license. Under the same law, violators convicted of tax evasion would be jailed from one month to one year and / or fined the equivalent of the imposed tax. Proceeds will towards boosting the state revenues and supporting the Government to continue implementing the development programmes and strike the balance between revenues and expenditure.