Five MPs have submitted an urgent proposal to amend Article (13) of Bahrain’s Value Added Tax (VAT) Law to ease cash-flow pressures on suppliers dealing with government entities.
The proposal, formally submitted last night, seeks to amend Decree-Law No. (48) of 2018 by adding a clause that redefines the “date of supply” for goods or services provided to government entities.
Under the proposed change, the date of supply would be the date on which payment is actually received, rather than the date of invoicing or delivery.
The MPs led by Hassan Ibrahim argue that government entities often take month – sometimes more than a year – to settle invoices, forcing suppliers to pay VAT long before receiving their dues.
“This situation places an unfair and unnecessary financial burden on suppliers and service providers,” said Mr Ibrahim. “Linking VAT liability to the actual receipt of payment achieves tax justice and protects businesses from cash-flow strain caused by delayed government payments.”
The explanatory memorandum stresses that the amendment aligns with constitutional principles of social justice in taxation and supports a sustainable business environment, particularly for small and medium enterprises.
&uuid=(email))