The value of the Excise goods (i.e. the ‘tax base’) for Excise Tax purposes would be the higher of (1) the retail sales price (RSP) declared by the producer, importer or warehouse keeper of the Excise goods (after deducting any Excise Tax amount included in that price) or (2) the standard price as listed in a Ministerial Decision/ minimum value listed by the GTA on its website. At present, there have not been any Ministerial Decisions issued on Excise Tax and the minimum values have yet to be provided by the GTA. However, the transitional Excise Tax return uploaded on the GAC website provides standard prices for a limited number of Excise goods. In the absence of such standard prices, the RSP should be used to determine the tax base of the Excise goods.
Registering for Excise
Tax Any person engaged in the importation or production of Excise goods, or in the operation of a tax warehouse in the state of Qatar, must register with the GTA for Excise Tax purposes. For the transitional period, the application should be submitted within 90 days from the effective date of the Qatar Excise Tax Law by all persons liable to register for Excise Tax, i.e., by 31 March 2019.
Following the transitional period, any person who intends to engage in the importation or production of Excise goods or in the operation of a tax warehouse would be required to submit the registration application within 30 days prior to the actual or intended involvement in such activities.
Once registered, taxpayers must submit quarterly Excise Tax returns within 15 days following the end of the tax period and pay the due taxes.
Tax return All persons who own or hold Excise goods on the date the Qatar Excise Tax Law comes into force and who intend to sell these goods for business purposes must file a one-time transitional Excise Tax return (no threshold for transitional) within 30 days from the effective Excise Tax date, i.e. by 30 January 2019. Businesses are to calculate the Excise Tax due based on their stock count on 31 December 2018 (11:59 PM). The Excise Tax due must be paid to the GTA within 30 days following the date of filing the transitional Excise Tax return.
If the value of the stock declared in the transitional Excise Tax return is more than QAR 50,000, an audit certificate from an accredited auditor in Qatar would need to be attached to the return before submission.
A tax warehouse allows for Excise goods to be produced and stored under a tax suspension arrangement where the charging of Excise Tax is deferred until the Excise goods are removed from the suspension arrangement. Any person who wishes to operate a tax warehouse may apply to the GTA for a tax warehouse licence. A Customs warehouse may be treated as a tax warehouse without being subject to additional licencing requirements.
Exemptions and refunds
Certain categories of persons including diplomatic and consular bodies, international organisations and travellers are exempt from the payment of Excise Tax. The GTA may refund the Excise Tax originally paid by taxable persons in any of the following cases:
- Export or re-export of Excise goods already released for consumption in Qatar;
- Use of Excise goods already released for consumption in Qatar to produce other Excise goods; or
- Movement of Excise goods already released for consumption in Qatar to another GCC Member State implementing Excise Tax.
Taxpayers are required to maintain regular and independent books and records relating to their Excise Tax transactions (physical or electronic) for at least 5 years following the end of the corresponding tax period.
Inspection and penalties
The GTA has extensive powers to ensure compliance with the Qatar Excise Tax law through audits, inspections and assessments. The GTA may also apply penalties to businesses that do not comply with the Excise Tax requirements such as failure to register for Excise Tax, submit returns and pay the Excise Tax due within the prescribed timeframe. The Qatar Excise Tax law provides further details on the cases of non-compliance and the type of penalties that may be levied on the taxpayer.