Are exports of goods zero-rated for VAT?

Article (34) Supplies to Outside the GCC Territory 1. The following supplies shall be subject to the zero-rate: a) the export of Goods outside the GCC Territory; b) supply of Goods to a customs duty suspension situation as provided for in the Common Customs Law and the supply of Goods within customs duty suspension situations; c) re-export of moveable Goods that have been temporarily imported into the GCC Territory for repairs, refurbishment, conversion or processing as well as the Services added to these Goods. Page 12 of 26 26 من12 صفحة d) supply of Services by a Taxable Supplier residing in a Member State for a Customer who does not reside in the GCC Territory who benefits from the service outside the GCC Territory in accordance with the criteria determined by each of the Member States, except for the cases provided for in Articles 17 to 21 of this Agreement that determine the place of supply as being in a Member State. 2. The supply of Goods and Services out of the GCC Territory shall be subject to the zero-rate when such supply is exempt from Tax inside the Member State.

Article 30 – Zero-rating the export of goods 17 1. The Direct Export shall be subject to the zero rate if the following two conditions are met: a. The Goods are physically exported to a place outside the Implementing States or are put into a customs suspension regime in accordance with the GCC Common Customs Law within 90 (ninety) days of the date of the supply. b. The exporter retains any of the following: 1) a customs declaration, and Commercial Evidence that proves the Export, 2) a Shipping Certificate and Official Evidence that prove the Export, or 3) a customs declaration that proves the suspension arrangement of customs duties, in case the Goods are put into customs suspension. 2. An Indirect Export shall be subject to the zero rate if the following conditions are met: 17 Article amended as per Cabinet Decision No. 100 of 2024. Cabinet Decision No. 52 of 2017 and its amendments – As published by the Ministry of Finance 22 a. The Goods are physically exported to a place outside the Implementing States or are put into a customs suspension regime in accordance with GCC Common Customs Law, within 90 (ninety) days of the date of the supply under an arrangement agreed by the supplier and the Overseas Customer at, or before, the date of supply. b. The Overseas Customer, or its agent, obtains any of the following and provides the supplier with a copy thereof: 1) a customs declaration, and Commercial Evidence that proves the Export, 2) a Shipping Certificate and Official Evidence that prove the Export, or 3) a customs declaration that proves the suspension arrangement of customs duties, in case the Goods are put into customs suspension. c. The Goods are not used or altered in the time between supply and Export or put under the suspension arrangement of customs duties, except to the extent necessary to prepare the Goods for Export or customs suspension. d. The Goods do not leave the State in the possession of a passenger or crew member of an aircraft or ship. 3. For the purposes of this Article, a movement of Goods into a Designated Zone from a place in the State or a supply of Goods to a Designated Zone shall not be considered an Export of those Goods. 4. For the purposes of Clauses 1 and 2 of this Article: a. “Official Evidence” means the export certificate issued by the customs departments in the State or a clearance certificate issued by these departments or the competent authorities in the State regarding the Goods leaving the State after verifying their departure from the State, or a document or clearance certificate certified by the competent authorities in the country of destination stating the entry of the Goods into the country. b. “Commercial Evidence” means the document issued by sea, air or land transport companies and agents, which proves the transfer and departure of the Goods from the State to outside the State, and includes any of the following documents: 1) Air waybill or air manifest. 2) Sea waybill or sea manifest. 3) Land waybill, or land manifest. c. “Shipping Certificate” means a certificate issued by sea, air or land transport companies and agents as an equivalent of a commercial evidence where it is not available. Cabinet Decision No. 52 of 2017 and its amendments – As published by the Ministry of Finance 23 5. The evidence obtained as proof of Export, whether official or commercial, must identify the following: a. The supplier. b. The consignor. c. The Goods. d. The value. e. The Export destination. f. The mode of transport and route of the export movement. 6. The Authority may decide not to accept the documents submitted if they do not constitute sufficient evidence of the exit of the Goods from the State, and may specify alternative forms of evidence according to the nature of the Export or the nature of the Goods being exported. 7. The Authority may extend the 90-day period mentioned in Clauses 1 and 2 of this Article, if the Authority has determined, after the supplier has applied in writing, that either of the following apply: a. Circumstances beyond the control of the Supplier and the Recipient of Goods have prevented, or will prevent, the Export of the Goods within 90 (ninety) days of the date of supply. b. Due to the nature of the supply, it is not practicable for the supplier to Export the Goods, or a class of the Goods, within 90 (ninety) days of the date of supply. 8. An Indirect Export would include a supply of Goods in a departure area of an airport or port to a passenger of an aircraft or a vessel if: a. The Goods are intended to leave the State in the possession of the passenger. b. The supplier has obtained and retained evidence, such as the details of the boarding pass of the passenger, that the passenger intends to leave for a destination outside the Implementing States. 9. If the Person required to Export the Goods in accordance with this Article does not do so within the period of 90 (ninety) days or a longer period that the Authority has allowed under Clause 7 of this Article, Tax shall be charged on the supply at the rate that would have been due on the supply if it was made in the State. 10. For the purposes of this Article, a supply of Goods shall be subject to the zero rate if the Goods that would otherwise have been exported are destroyed or cease to exist in circumstances beyond the control of both the supplier and the Recipient of the Goods. 11. Customs departments shall check to confirm the type and quantity of the exported Goods with the export documents issued, according to the customs procedures, Cabinet Decision No. 52 of 2017 and its amendments – As published by the Ministry of Finance 24 and based on the classification of the tax risk matrix that is specified in coordination with the Authority.