Muscat: A 5% value-added tax will be applied to hotel reservations and shop rentals starting from Friday, April 16, as the Value Added Tax (VAT) comes to force.
Residential rentals are excluded from value-added tax, according to the tax authority.
The Tax Authority said that any building or part of it designed for residential purposes and obtained the required approvals is exempt from VAT.
While hotels, tourist complexes, industrial and commercial complexes, and hotel apartments are subject to a 5% value-added tax.
With regard to tax transactions for residential real estate, the first sale of residential real estate is subject to a 5% tax, and is exempt from tax upon resale or when renting the property.