GCC Indirect Tax News Roundup - Quarter Four 2025

Executive summary

The GCC Indirect Tax News Roundup for Quarter Four 2025 highlights a continued acceleration in indirect tax reform across the region, with authorities advancing legislative change, strengthening enforcement frameworks and progressing digital transformation agendas.

This quarter was marked by significant developments in the UAE, including extensive amendments to tax procedures, VAT and excise tax legislation, a revised administrative penalty framework, new excise tax rate structures for sweetened drinks, and further steps towards mandatory e-Invoicing. In Saudi Arabia, changes to VAT grouping rules, new guidance for electronic marketplaces, customs tariff amendments and a move to sugar-based excise taxation signal a continued focus on regulatory maturity and alignment with Vision 2030. Oman introduced short-term relief measures for soft drinks under the excise regime, while simultaneously advancing excise tax warehousing and the phased rollout of e-Invoicing under the Fawtara programme.

Together, these updates reinforce the growing expectations placed on businesses operating in the GCC to enhance governance, strengthen controls, and invest in systems and processes that support proactive, compliant and future-ready indirect tax operations.

The United Arab Emirates (UAE)

• Introduction of a revised administrative penalty framework, effective 14 April 2026, simplifying penalty calculations and strengthening incentives for voluntary disclosure.
• Significant amendments to the Tax Procedures Law, VAT Law and Excise Tax Law, effective 1 January 2026, including aligned five-year limitation periods and transitional refund provisions.
• Implementation of a reverse charge mechanism on the local supply of specified scrap metal from 14 January 2026.
• Issuance of an updated VAT Administrative Exceptions Guide, narrowing the scope of exceptions and enhancing documentation and procedural requirements.
• Publication of violations and penalties linked to the Electronic Invoicing System, reinforcing the need for early readiness ahead of mandatory adoption.
• Extension of increased customs duty rates on selected steel products at 10% until October 2028.
• Entry into force of new Comprehensive Economic Partnership Agreements with Australia, Malaysia and Chile, delivering broad tariff eliminations and enhanced trade facilitation.
• Imposition of final anti-dumping duties on selected Chinese and Indian sanitaryware products through 2030.
• Introduction of a new excise tax rate structure for sweetened drinks, based on sugar and sweetener content, effective January 2026.

The Kingdom of Saudi Arabia (KSA)

• Amendments to VAT grouping regulations, tightening eligibility conditions. and introducing new documentation requirements, effective October 2025.
• Issuance of detailed guidance on deemed supplier obligations for electronic marketplaces, effective from January 2026.
• Publication of amendments to the customs tariff, including new and revised HS codes and increased duties on selected goods.
• Approval of amendments to excise tax regulations, replacing the flat ad valorem rate on sweetened beverages with a tiered, sugar-based specific rate structure from January 2026, together with transitional measures.

Oman

• Suspension and postponement of Digital Tax Stamp requirements for soft drinks, providing short-term compliance relief.
• Announcement of the imminent activation of the excise tax warehousing system, introducing excise suspension arrangements and new licensing and operational requirements.
• Continued progress on the Fawtara e-Invoicing programme, including release of the eInvoicing Data Dictionary, public consultations, publication of implementation timelines, and issuance of service provider accreditation criteria.