Base price
Fix the approved retail selling price before both taxes.
Last checked: 27 August 2026
Which value should I use to calculate Excise Tax?
The rate may be known, but the result is not reliable until the product and tax base are fixed. Start with the correct base price, calculate Excise Tax, then separate the VAT effect.
Core formula
Correct base first — then the rate
The base is the higher of the retail price set by the importer or producer and the approved standard price, net of included taxes (Regulations Art. 4(d); Agreement Art. 6(2)), i.e. before Excise Tax and VAT. Do not start from the final shelf price unless it has first been correctly separated into its components.
Base price×Category rateExcise amount
Fix the tax base
How do you choose the starting price?
The official list is not merely a name directory; its product and price data form part of the operational check. The higher-value comparison applies to local producers and importers alike; on import, the retail selling price is declared to Customs (Art. 31(b)), which is not the customs value.
- 01
Identify the exact product: category, brand, description, size and unique code.
- 02
Check the Excise Goods List for the registered retail selling price per unit.
- 03
Compare the listed price with the retail selling price you set as producer or importer (declared to Customs on import).
- 04
Use the price required by the higher-value rule, then apply the category rate.
Import example
A lower declared price does not automatically become the tax base
Assume a carbonated drink: listed price BHD 1.200 and customs-declared price BHD 1.000. Calculation starts from BHD 1.200 as the higher value, producing BHD 0.600 Excise Tax at 50%.
Listed price1.200BHD
›Declared price1.000BHD
Illustrative examples
Same steps, different rates
Each example assumes a correct base price before both taxes. Tobacco has a specific value basis under Agreement Article 6(1) and Supreme Council decisions (read with Regulations Art. 4(d)), so the tobacco example assumes the value set in the NBR list is the base. Figures are educational and do not represent an actual product in the official list.
CategoryBase priceRateExciseAfter Excise, before VAT
Carbonated drink1.00050%0.5001.500
Energy drink0.800100%0.8001.600
Tobacco product2.500100%2.5005.000
Amounts are in Bahraini dinars. The amount after Excise Tax may be subject to VAT under its own rules, but that is a separate calculation from determining Excise Tax.
Calculation order
Do not mix Excise Tax with VAT
Excise Tax
Multiply the base by the goods rate: 50% or 100%.
Amount before VAT
Add the base price and Excise amount.
VAT
Test and calculate it afterwards under VAT rules; it does not form part of the Excise base.
Common mistakes
Six mistakes that change the result
Applying the rate to the final shelf price even though it may include both taxes.
Using a lower invoice price without testing the higher-value rule.
Searching by brand alone and ignoring pack size or the product code.
Adding VAT before Excise Tax or calculating Excise Tax on an amount that includes VAT.
Applying one rate across an invoice containing different categories or sizes.
Treating a Madar example as official pricing for a real product.
Important time boundary
This page explains the currently published method
The 2026-ratified Agreement Amendment Annex permits future percentage, per-unit or combined methods, but did not itself set new operational amounts in Bahrain. These examples therefore follow the published method until an effective legislative amendment is issued and NBR data are updated.
Review the 2026 amendment noticeLegal basis and operational sources
This guide is based on Article 3 of the Law and Articles 2–4 of the Executive Regulations, together with the Excise Goods List, NBR overview and customs-declaration requirements. Where product or price data differ, current NBR data and the effective text should be checked before filing or customs release.