English translation published by the Legislation and Legal Opinion Commission. The Arabic text published in the Official Gazette remains the legal reference in the event of any discrepancy.
Government-entity Supplies are taxable when made in a non-sovereign capacity through an Economic Activity competing with the private sector. Prime Ministerial decisions identify the relevant entities, Supplies, returns and deregistration treatment.
Government entities, their customers and businesses competing in the same activities.
A government supplier is not automatically taxable or outside scope. The nature and capacity of the activity and the applicable decisions must be checked.
Current text
Review a government-entity Supply
- 1
Identify the entity and Supply precisely.
- 2
Determine whether the activity is sovereign or an Economic Activity carried out competitively.
- 3
Check Decision No. (43) of 2018 and its amendments on the official decisions page.
- 4
Confirm the contract, invoice and the customer's deduction position.
Connected provisions
Law — Article (2)
Scope of VATIt connects the government Supply to the general rule imposing VAT on Supplies within scope.
Open connected ArticleLaw — Article (4)
Persons liableIt is reviewed after taxability is established to determine payment and invoicing obligations.
Open connected ArticleOfficial guides and tools
A sovereign fee or a competitive Service?
An amount charged for an exclusive governmental function differs from a commercial Service offered in competition with private businesses. The facts must be matched to the applicable decisions before invoicing.
Questions to help you apply it
- Is the Supply sovereign or a competitive Economic Activity?
- Is the entity or Supply covered by the current decision and amendments?
- What is the impact on the invoice, the entity's Return and the customer's deduction?