In February 2026, the Oman Tax Authority announced that it collected OMR 84 million in excise tax during 2025 — while the number of excise-registered businesses had grown 222% between 2021 and 2025 (OTA Annual Results, Times of Oman, February 2026). That 222% figure is the highest registrant growth rate of any tax type in Oman, and it tells you something about how aggressively the OTA has been pursuing compliance in this category.
Oman's excise tax applies rates of 50% and 100% to a defined list of products: tobacco, alcoholic beverages, energy drinks, carbonated soft drinks, sugar-sweetened beverages, and electronic smoking devices. If your business imports, produces, or warehouses any of these goods, the obligations don't just include paying tax. You must register before activity begins, file quarterly returns, document your retail selling prices, and comply with the Digital Tax Stamp rules for excisable beverages (import enforcement active since 1 June 2025; domestic rules varying by product category from January 2026).
This guide covers the full picture: the legal framework, exact rates by product, registration rules, how tax is calculated (including the 2025 shift away from standard list prices), quarterly return mechanics, the penalty structure, and what the Digital Tax Stamp requirements mean for importers and producers.
Key Takeaways- Oman excise tax rates are 100% on tobacco, alcohol, energy drinks, and electronic smoking devices; 50% on carbonated soft drinks and sugar-sweetened beverages — set by Royal Decree No. 23/2019, effective 15 June 2019 (OTA Tax Portal, 2026)- Excise-registered businesses grew 222% from 2021 to 2025 — the fastest registrant growth of any Oman tax type (OTA Annual Results, Muscat Daily, February 2026)- There is no monetary registration threshold — producers, importers, and tax warehouse operators must register with the OTA before commencing activity- From 1 June 2025, Oman Customs refuses clearance for excisable beverages without valid Digital Tax Stamps; energy drink domestic enforcement began 1 January 2026, with soft drinks further postponed by the OTA in December 2025
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What Is Oman Excise Tax and How Does It Work?
In July 2020, the OTA completed Oman's excise tax framework by issuing the Executive Regulations under Ministerial Decision No. 51/2020 — the detailed rules that govern registration, calculation, filing, and penalties — following the primary legislation under Royal Decree No. 23/2019, which took effect on 15 June 2019 (Deloitte Middle East, "Oman issues excise tax Executive Regulations", July 2020). Oman was among the later GCC states to implement excise, and it aligned its rates and product categories closely with the GCC Excise Tax Framework Agreement that Saudi Arabia and the UAE had already adopted in 2017.
Excise tax is a single-stage consumption tax. Unlike VAT, which is collected at every stage of the supply chain and recovered as input tax, excise is paid once — at the point of import clearance, at the moment of domestic production for local sale, or when goods are released from a licensed tax warehouse into the domestic market. There is no input tax recovery mechanism. The tax is a permanent cost embedded in the supply chain from the first taxable event.
The rate applies to the retail selling price (RSP) — what the product will ultimately be sold for to the Omani consumer — not the import or wholesale cost. This is why excise represents such a large share of a product's landed cost for high-rate goods, and why it shows up so visibly in shelf prices.
What's the taxable event? Import clearance through Oman Customs for imported goods. Release from a licensed tax warehouse for domestic consumption. Production of excisable goods for domestic sale. Transfer between licensed tax warehouses does not trigger liability.
The OTA administers excise through the same Tax Management System (TMS) portal at tms.taxoman.gov.om that handles VAT and income tax. In 2025, excise generated OMR 84 million — approximately 6.1% of total tax revenue of OMR 1.373 billion (OTA Annual Results, Muscat Daily, February 2026; percentage is author's calculation). It's not the largest revenue category, but it's growing faster than either income tax or VAT, which is exactly why the OTA has accelerated its enforcement activity in this area.
For the broader VAT framework that runs in parallel with excise for most affected businesses, see our complete Oman VAT guide.
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Which Products Are Subject to Excise Tax in Oman?
As of 2026, the OTA recognises eight product categories as excisable, across two rate tiers (PwC, "Oman – Corporate – Other taxes," Worldwide Tax Summaries, December 2025). The 100% tier covers products the OTA and GCC health authorities classify as directly harmful; the 50% tier covers beverages linked to obesity and metabolic disease.
Products taxed at 100%:
- Tobacco and tobacco derivatives (cigarettes, shisha, cigars, chewing tobacco, snuff)
- Pork products
- Alcoholic beverages
- Energy drinks (defined as drinks with added caffeine marketed as energising or stimulating)
- Electronic smoking devices (vaping hardware) — *import and retail sale has historically been restricted in Oman; confirm the current position with the Ministry of Commerce before importing*
- Vaping liquids
Products taxed at 50%:
- Carbonated soft drinks (all products with added carbonation, including flavoured sparkling water)
- Sugar-sweetened beverages (non-carbonated drinks with added sugar, expanded to this category from 1 October 2020)
When a product qualifies under more than one category, the higher rate applies. An energy drink that's also carbonated is 100%, not 50%. Products containing alcohol but classified as medicines or disinfectants under applicable Omani regulations may be excluded — but this requires advance classification approval from the OTA, not a self-assessment.
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Who Must Register for Excise Tax in Oman?
Unlike Oman VAT — which only becomes mandatory when taxable supplies exceed OMR 38,500 per year — excise tax registration has no monetary threshold (Deloitte Middle East, July 2020). If your business produces, imports, or operates a licensed warehouse for excisable goods in Oman, you must register before commencing that activity. Volume, value, and turnover don't change the obligation.
The three primary registrant categories are:
Producers: Any person manufacturing excisable goods in Oman for domestic sale. Registration must precede the first production run intended for local consumption.
Importers: Any business importing excisable goods into Oman for commercial purposes. The only carve-out is for "irregular" importers — businesses that import excisable goods very infrequently for non-commercial purposes. These businesses may be exempt from periodic return filing obligations, but the OTA determines this classification; confirm eligibility directly with the OTA through the TMS portal before treating yourself as exempt.
Tax warehouse operators: Businesses that operate OTA-licensed facilities for storing excisable goods in a tax-suspended state. The warehouse licence must be in place before goods enter the facility.
Registration is done through the OTA's TMS portal at tms.taxoman.gov.om. You'll need your commercial registration, VAT registration number (if you're VAT-registered), details of the excisable goods you handle, and evidence of your premises or import arrangements. Failing to register when required triggers back-liability from the date activity commenced, plus penalties — there's no grace period.
If you're also working through your VAT registration, which applies to most of the same businesses at the OMR 38,500 threshold, see our step-by-step Oman VAT registration guide for the TMS process.
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How Is Excise Tax Calculated in 2026?
The OTA announced at its annual tax conference on 6 May 2025 that Standard List Prices — the OTA-published prices that had been used as the mandatory tax base since 2019 — would be abolished (PwC, "Oman Tax News Update", May 2025). Taxpayers are now required to self-determine and document their own Retail Selling Prices for excise calculation. No competitor guide published before mid-2026 addresses this change — it substantially shifts the documentation burden onto importers and producers.
The formula itself is straightforward:
Excise Tax = Retail Selling Price (RSP) × Applicable Rate
The RSP is the price at which the excisable good will be sold to the final consumer in Oman. For imported goods, the RSP must be declared at import and supported by documentary evidence: recommended price lists, distributor agreements, market comparables, or a documented pricing methodology that the OTA can audit.
A worked example for an energy drink import:
| Item | Amount |
|---|---|
| Retail Selling Price per unit | OMR 1.500 |
| Excise rate | 100% |
| Excise tax per unit | OMR 1.500 |
| Case of 24 units — total excise | OMR 36.000 |
The excise is paid at import clearance. After that, VAT is calculated separately on the excise-inclusive price when the goods are sold in Oman (covered in the VAT interaction section below).
What if there's no established RSP for your product? The OTA expects you to apply a reasonable, market-based methodology and be prepared to justify it on audit. Don't apply import cost or wholesale price — that's not an RSP, and it's the kind of error that generates an assessment with interest.
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When and How Do You File Your Excise Return?
Oman excise tax returns are filed quarterly, within 30 days of each calendar quarter-end (Deloitte Middle East, "Mark your calendars: Tax Updates and Deadlines for Q1 2025", January 2025). Payment is due at the same moment as the return — you can't file and defer.
| Quarter | Period | Filing & Payment Deadline |
|---|---|---|
| Q1 | January – March | 30 April |
| Q2 | April – June | 30 July |
| Q3 | July – September | 30 October |
| Q4 | October – December | 30 January (following year) |
Returns are submitted electronically through the TMS portal and cover all taxable events during the quarter: imports cleared through Oman Customs, domestic production released for sale, and adjustments for goods returned or legally destroyed. Importers must also file a separate annual import statement within 30 days of tax year-end, summarising all excisable goods imported during the year. The OTA cross-checks this against Customs records, so your figures need to reconcile.
Does excise connect to the Fawtara e-invoicing rollout? Indirectly, yes. Excisable goods are subject to VAT, and when you sell them, you must issue a compliant VAT invoice. Once Phase 1 of Fawtara begins in August 2026, VAT-registered businesses selling excisable goods must route those invoices through an accredited service provider. For the full timeline and what's required, see our Oman Fawtara e-invoicing guide.
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What Penalties Does the OTA Apply for Non-Compliance?
Oman's excise penalty framework has three tiers, rising from administrative fines to criminal prosecution (Deloitte Middle East, July 2020). The OTA isn't the only enforcement body — Oman Customs plays a role at the border, and the Public Prosecution handles criminal cases.
Administrative penalties (OMR 500–5,000) cover:
- Failure to register on time
- Late or missing quarterly or annual returns
- Inadequate record-keeping
- Non-compliance with tax warehouse licence conditions
- Refusing to provide information to OTA inspectors
Serious violation penalties (OMR 1,000–10,000) apply to:
- Fraudulent refund claims
- Deliberate understatement of excise liability
- Obstruction of OTA audit or inspection
Criminal penalties — imprisonment from two months to three years and/or a fine of up to OMR 20,000 — apply to deliberate tax evasion, fraud on the OTA, and operating an unregistered excise warehouse. The OTA refers criminal matters to the Public Prosecution; it doesn't handle them internally.
From 1 January 2026, a fourth enforcement layer applies specifically to Digital Tax Stamp violations for energy drinks: the OTA and Customs can prohibit the sale and circulation of unstamped beverages and seize the goods. Licence suspension is available for repeat violations.
The 222% growth in excise registrations from 2021 to 2025 isn't explained by market growth alone — it reflects active OTA registration campaigns. Businesses operating near the boundary of excise obligations are exactly the ones the OTA is targeting. For a deeper look at how the OTA investigates tax matters across all tax types, see our Oman VAT audit guide.
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Digital Tax Stamps: What the 2026 Rules Mean for Your Business
Oman has required Digital Tax Stamps (DTS) on tobacco products since 2020. In 2024, the OTA extended Phase 3 of the DTS programme to excisable beverages — carbonated soft drinks and energy drinks (Deloitte Middle East, "Oman – Implementation of Tax Stamps on Excisable Drinks", October 2025). The enforcement timeline went through two postponements before landing at the current dates — and most guides published in 2024 and early 2025 cite the old dates.
The correct DTS timeline for beverages:
- 1 January 2025: Tax stamps must be activated on all excisable products entering Oman's market (existing requirement, updated scope)
- 1 June 2025: Oman Customs began refusing clearance for excisable beverages without valid Digital Tax Stamps — unstamped imports are returned to origin or destroyed at the importer's cost
- November 2025: The original domestic enforcement date — postponed
- 1 January 2026: Domestic sale and circulation of energy drinks without valid Digital Tax Stamps is prohibited; penalties and seizure apply (Gulf News, "Oman postpones digital tax stamps on soft and energy drinks to January 1, 2026", 2025). Carbonated soft drinks: the OTA issued a further postponement in December 2025 (Muscat Daily, December 2025); a revised domestic enforcement date had not been confirmed as of the publication of this guide
The stamps are 15mm × 15mm serialised labels applied to each individual unit, either as physical adhesive labels or as direct-to-product printed marks for domestic producers. Each stamp carries a unique identifier linked to the OTA's tracking system, operated in partnership with De La Rue — the British digital tax solutions company used by several GCC tax authorities for the same purpose. The system lets the OTA trace every unit from production or import through to the point of sale.
Operationally, if you import beverages, your overseas supplier or a stamping facility approved by the OTA must apply stamps before the shipment reaches Oman Customs. If you're a domestic producer, stamps are applied at the production stage, before goods leave your facility for distribution.
What's excluded from DTS requirements? Products in transit, goods intended for export, and duty-free sales are all outside the scope. Stock imported before 1 June 2025 that was already in circulation before 1 January 2026 had a transitional window — but that window is now closed.
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How Excise Tax and VAT Interact — and What Free Zones Mean for You
In Oman, VAT is calculated on the excise-inclusive retail price — not on the pre-excise cost of the product (PwC, Worldwide Tax Summaries, December 2025). Excise is embedded in the VAT tax base, which means both taxes stack. The consumer pays VAT on a price that already includes excise. This is the point most guides either skip or understate.
A concrete example using an energy drink:
| Step | Amount |
|---|---|
| Base retail selling price | OMR 1.000 |
| Excise tax (100%) | OMR 1.000 |
| Excise-inclusive RSP | OMR 2.000 |
| VAT at 5% on OMR 2.000 | OMR 0.100 |
| Consumer price | OMR 2.100 |
The importer pays OMR 1.000 in excise at import. When the retailer sells the drink at OMR 2.100, it collects OMR 0.100 in VAT and remits that on its quarterly VAT return. The excise and VAT flows are separate — excise doesn't appear as a line on the VAT return; it's already settled at the border.
Free zones and tax warehouses: Excisable goods held in OTA-licensed tax warehouses are in a suspended state — excise liability doesn't arise until those goods are released for domestic consumption. Free zone businesses can hold excisable goods without excise triggering, provided those goods are for re-export or business-to-business transfer, not personal consumption within the zone. Oman's Special Economic Zones Law (Royal Decree No. 38/2025, effective 14 April 2025) doesn't override excise obligations — goods consumed personally within a free zone remain liable at the standard rates.
Export refunds: Exports of excisable goods produced in Oman are eligible for excise refund. From May 2025, the OTA also announced an ab-initio waiver mechanism — meaning the excise obligation doesn't arise at all for goods intended for export, rather than arising and being refunded later. This reduces cash flow impact for Omani producers exporting to GCC markets.
For the VAT compliance framework that runs alongside excise for most affected businesses — including input tax recovery on business costs, quarterly VAT return mechanics, and the OTA's audit approach — see our complete Oman VAT compliance guide.
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Frequently Asked Questions
What products are subject to excise tax in Oman?
Oman excise tax applies to eight product categories at two rates: tobacco and derivatives, pork products, alcoholic beverages, energy drinks, electronic smoking devices, and vaping liquids are taxed at 100%; carbonated soft drinks and sugar-sweetened beverages are taxed at 50%. Rates are set by Royal Decree No. 23/2019 and published on the OTA Tax Portal (tms.taxoman.gov.om, 2026).
Is there a turnover threshold for excise tax registration in Oman?
No. Unlike Oman VAT (mandatory registration at OMR 38,500 in annual taxable supplies), excise tax has no monetary registration threshold. Any person that produces, imports, or operates a licensed tax warehouse for excisable goods must register with the OTA before commencing that activity, regardless of volume or value (Deloitte Middle East, July 2020).
When are Oman excise tax returns due?
Excise tax returns are filed quarterly, within 30 days of each quarter-end: 30 April for Q1, 30 July for Q2, 30 October for Q3, and 30 January of the following year for Q4. Payment is due at the same time as the return. Importers must also file a separate annual import summary within 30 days of tax year-end (Deloitte Middle East, January 2025).
How does Oman excise tax affect VAT calculation?
VAT in Oman is calculated on the excise-inclusive retail selling price, not the pre-excise price. An energy drink with a base RSP of OMR 1.000 incurs OMR 1.000 in excise, making the excise-inclusive RSP OMR 2.000. VAT at 5% is then charged on OMR 2.000, giving a consumer price of OMR 2.100. Both taxes apply concurrently (PwC Worldwide Tax Summaries, December 2025).
What are the Digital Tax Stamp requirements for excisable beverages in Oman?
From 1 June 2025, Oman Customs refuses clearance for excisable beverages without valid Digital Tax Stamps. From 1 January 2026, domestic sale and circulation of unstamped excisable beverages is prohibited. Stamps are 15mm × 15mm serialised labels applied at production or before import, tracked through the OTA's system operated with De La Rue (Deloitte Middle East, October 2025).
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Sources
- Oman Tax Authority, "Tax Rate," OTA Tax Portal, retrieved 2026-06-22, https://tms.taxoman.gov.om/portal/tax-rate
- Deloitte Middle East, "Oman issues excise tax Executive Regulations," retrieved 2026-06-22, https://www.deloitte.com/middle-east/en/services/tax/perspectives/oman-issues-excise-tax-executive-regulations.html
- Deloitte Middle East, "Oman Excise Tax Expansion," retrieved 2026-06-22, https://www.deloitte.com/middle-east/en/services/tax/perspectives/oman-excise-tax-expansion.html
- Deloitte Middle East, "Oman – Implementation of Tax Stamps on Excisable Drinks," retrieved 2026-06-22, https://www.deloitte.com/middle-east/en/services/tax/perspectives/oman-implementation-of-tax-stamps-on-excisable-drinks.html
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- PwC, "Oman – Corporate – Other taxes," Worldwide Tax Summaries, retrieved 2026-06-22, https://taxsummaries.pwc.com/oman/corporate/other-taxes
- PwC, "Oman Tax News Update," retrieved 2026-06-22, https://www.pwc.com/m1/en/services/tax/me-tax-legal-news/2025/oman-tax-news-update.html
- Times of Oman, "Oman's tax revenues exceed OMR 1.3 billion," retrieved 2026-06-22, https://timesofoman.com/article/167926-omans-tax-revenues-exceed-omr-13-billion
- Muscat Daily, "Oman's tax revenue surges past RO 1.3 bn in 2025," retrieved 2026-06-22, https://www.muscatdaily.com/2026/02/05/omans-tax-revenue-surges-past-ro-1-3-bn-in-2025/
- Gulf News, "Oman mandates digital tax stamp on imported beverages from June 1," retrieved 2026-06-22, https://gulfnews.com/world/gulf/oman/oman-mandates-digital-tax-stamp-on-imported-beverages-from-june-1-1.500139144
- Gulf News, "Oman postpones digital tax stamps on soft and energy drinks to January 1, 2026," retrieved 2026-06-22, https://gulfnews.com/business/tax-news/omans-tax-authority-postpones-digital-tax-stamps-on-soft-and-energy-drinks-to-january-1-2026-1.500324798
- Muscat Daily, "Tax authority postpones digital tax stamp for soft drinks," retrieved 2026-06-22, https://www.muscatdaily.com/2025/12/23/tax-authority-postpones-digital-tax-stamp-for-soft-drinks/