Sugar drinks to cost more from Oct 1

MUSCAT: Beginning October 1, sweetened drinks will cost more in Oman as the government is all set to introduce a 50 per cent excise tax on these products.

The decision issued by the Tax Authority on June 18 last included a list of products include juices, fruit drinks, energy or sport drinks, canned coffee and tea products.

“Beverages containing added sugar or sweeteners that are ready-to-drink, concentrates, gels, powders, extracts, or any form that can be converted into sugar sweetened beverage, will be subject to a 50 per cent excise tax from October 1, 2020”, says the decision issued by the Authority.

The list excluded some products such as 100 per cent natural fruit and vegetable juices, milk, and other dairy products that contain at least 75 per cent of milk, nutritional supplements, and beverages intended for special dietary and medical use.

The excise tax also referred to as selective tax was earlier introduced on June 15, 2019 and covered five products — carbonated drinks, energy drinks, tobacco products, pork and alcohol.

The scope of sugary or sweetened beverages or drinks is expected to be very wide as it will not only help increase the state revenue but will also improve health outcomes.

According to health experts, tax is a major step that can reduce its consumption of sugar drinks, that will finally help the government trim a number of diseases.

“Sugary drinks are a major source of sugar in the diet, and its consumption is increasing, especially amongst children and adolescents. Sugar is a major contributor to obesity, diabetes and related diseases”, said Dr. Hemant Keluskar, diabatologist.

World Health Organisation suggests that countries need comprehensive action plans that combine taxation, restriction of marketing of sugary products to children, and education to reduce over-consumption of sugars that will help halt the epidemic of obesity and diabetes.

Terming it as a move in the positive direction, Dawood Ismaili, an academic said that the introduction of the selective tax will help those who are addicted to sugar drinks to get away with their habits.

“Like the tax on tobacco could cut down on smoking, the use of sugary drinks will also be reduced especially in view of the present situation that warrants people to cut spending”, he said.

According to the statement, “businesses that serve or sell sweetened beverages will now be required to submit a notification to the Tax Authority of their stock of these products and pay the tax thereon within 15 days from the start of the application of the tax to them, the statement concluded”.

Oman is the third country in the Gulf Cooperation Council to introduce excise tax on sugar-sweetened beverages. Saudi Arabia and UAE introduced excise tax on sugar-sweetened beverages on December 1, 2019.

Bahrain and Qatar introduced excise tax on December 30, 2017 and January 1, 2019, respectively, but are yet to announce the introduction of excise tax on sugar sweetened beverages.