Bahrain: Insurance industry discusses VAT
Source: Middle East Insurance Review | May 2019
Insurers should develop a consistent approach to industry-wide issues rather than developing individual stances that may or may not be accepted by the National Bureau of Revenue (NBR), Bahrain’s tax authority, according to Mr Omar Hisham, an adviser to the insurance industry.
He was speaking at a roundtable on VAT which was introduced in Bahrain on 1 January 2019. The roundtable was attended by representatives of insurers, reinsurers and brokers, reported Gulf Daily News.
“Insurance globally is recognised as a complicated, specialist industry. VAT has added an extra layer of complication,” said Mr Mubeen Khadir, a senior director and head of tax for the Keypoint group.
Ms Zainab Mearaj, a VAT adviser to the insurance industry, said insurers across the region were struggling with aspects of VAT, not least because regulators often did not have a strong understanding of the issues the industry has raised.
The VAT rate in Bahrain is 5%, similar to that in the UAE and Saudi Arabia. Bahrain is introducing the VAT in stages. The first phase involves businesses with sales exceeding BHD5m ($13.3m) that would have to register for VAT by 20 December 2019.
VAT is part of a GCC agreement in 2018. To date, the remaining GCC members – namely, Kuwait, Oman and Qatar – have yet to implement the VAT. M
BHD1 = $2.66