Bahrain doubled its VAT rate to 10 per cent — the largest single increase in the bloc

Bahrain now applies a standard VAT rate of 10 per cent, double the rate it introduced when the tax first came into force. That places it above the 5 per cent applied in the UAE and Oman, and below Saudi Arabia’s 15 per cent.

Rate changes create a transitional problem that catches businesses out repeatedly: which rate applies to a supply that straddles the change date. The answer usually turns on the tax point rather than the invoice date, and long-running contracts are where the ambiguity concentrates.

The commercial question — who absorbs the difference — is settled by the contract, not by the tax law. Agreements silent on VAT tend to produce the most argument.

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