Set to review new tax model for sugary beverages

TDT | Manama

Email: mail@newsofbahrain.com

The proposed changes would give GCC states greater flexibility in calculating excise duties, allowing taxes to be applied as a percentage of a product’s value, a fixed amount per unit, or a combination of both, rather than being limited to a single method.

According to the Ministry of Finance and National Economy and the National Bureau for Revenue, the amendment is particularly aimed at sweetened drinks, which would be taxed based on a fixed charge linked to sugar content rather than price.

Officials told MPs in an April 22, 2026 meeting that the revised system supports public health objectives and aligns with World Health Organisation guidance on reducing sugar consumption.

Bahrain originally adopted the GCC excise tax framework under Law No. 39 of 2017, which applies duties to selected categories of goods. The latest amendment, signed on June 1, 2025, revises the definition and calculation of taxable value, allowing alternative pricing mechanisms.

The amendment further removes previous wording from Article 3 regarding tax rates for harmful, luxury, and environmentally damaging goods, transferring those provisions to the revised framework. Changes to Article 16 would also allow each GCC member state to set its own payment timelines and conditions.

The ministry and bureau said Bahrain will need additional amendments to its national excise tax law under Decree No. 78 of 2025 to align with the regional changes.

The draft law, consisting of two articles, ratifies the GCC amendment and mandates its implementation upon publication in the Official Gazette. Both the Legislative and Legal Affairs Committee and the Financial and Economic Affairs Committee have deemed it constitutionally sound and approved it in its current form.