KUWAIT IS PLANNING TO ADOPT SELECTIVE TAXES, WITH A 10-25 PERCENT RATE BEING CONSIDERED

  • 21/03/2022

Kuwait City: Instead of a value-added tax, the government has taken practical steps to study the implementation of the idea of selective taxation, which will include tobacco and its derivatives, soft and sweetened drinks, as well as expensive goods such as watches, jewellery, and precious stones, as well as luxury cars and yachts. According to the report, the use of selective taxes, on which the government is working behind the scenes, will range between 10% and 25%. 


Regarding the exclusion of value-added tax, sources stated that this alternative must be approved by the National Assembly, which is generally opposed by the public and parliament, making it impossible to implement, especially given Kuwait's announced inflation rate of around 3%. The tangible amount exceeds 7%, implying that if the new tax law is implemented, this trend may result in further price increases. 

According to the sources, the government would earn about 500 million dinars per year if the selective value tax was implemented, explaining that the selective tax may have a large part of justice in the application, as whoever chooses goods harmful to health must pay more, given that the government spends a lot of money on health programmes and treatments for cardiovascular diseases, obesity, and sugar from smoking, soft drinks, and energy drinks.

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