A construction company proprietor who evaded more than BD35,000 in value-added tax (VAT) has lost his final appeal at the Cassation Court.
In August 2024, the 52-year-old Bahraini businessman was sentenced to six months in prison and ordered to repay BD35,327 in unpaid taxes. He was also fined an additional BD35,327.
He was convicted of ‘total tax evasion’ by the High Criminal Court after failing to pay dues on taxable services provided by his construction company over a four-year period.
He had previously stated that he was unable to pass on the VAT to the government because he did not receive payments that the company was entitled to for work carried out during the Covid-19 pandemic.
According to Sijilat commercial registration (CR) records, the single-person company (SPC) is licensed to construct buildings, carry out demolition work, prepare sites for construction, and equip buildings with electrical wiring for connection to the power grid.
Court documents state that the evasion began in 2021 but was uncovered in 2024, when National Bureau for Revenue (NBR) officials found a discrepancy in the company’s paperwork.
Over the course of six payments of BD12,313, BD6,757, BD6,167, BD5,499, BD3,988 and BD603, the company’s general director reportedly accrued BD35,327 in unpaid taxes.
Though the entrepreneur had submitted VAT return documentation, which specified exactly how much he owed the NBR, he did not pay any of the outstanding amounts even after the 120-day deadline was over.
During Public Prosecution hearings, officials from the NBR Tax Returns Department testified against the appellant.
In addition, a legal consultant submitted a report detailing the tax evasion to the prosecution, which was relied upon as evidence to charge the appellant with the offence.
After concluding that legal action must be taken, the NBR presented a request to the prosecution, asking to advance criminal charges against the Bahraini man.
He took to the Supreme Criminal Appeals Court, which in February 2025 rejected his first appeal, upholding the six-month sentence and a total of BD70,654 in financial penalties.
Although he blamed the Covid-19 pandemic for not receiving payments from clients, his appeal was still upheld by judges.
His second and final appeal has also been rejected by the Cassation Court.
The NBR has set up a hotline (80008001) to report tax violations, which is available to receive calls round-the-clock.
Reports can also be made through the National Suggestions and Complaints System (Tawasul).
VAT violations include not displaying prices inclusive of VAT, failure to issue VAT invoices, not displaying a VAT certificate in a visible location and non-compliance with the Digital Stamp Scheme.
Queries about VAT and the Digital Stamps Scheme are received on vat@nbr.gov.bh and ds@nbr.gov.bh respectively.
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