Fiscal Balance Program
Bahrain's government continues its Fiscal Balance Programme aimed at achieving budget balance by 2024-2026. Key revenue measures include VAT optimization, improved tax collection efficiency, and potential new revenue sources.
Total budget revenue
Total expenditure
GDP growth forecast
Key Tax Implications
📊 VAT Revenue Boost
With the 10% VAT rate in effect, the government expects significantly higher VAT revenue. Enhanced enforcement and audit activity expected.
🏛️ Pillar Two Preparation
Budget allocates resources to implement the OECD Pillar Two DMTT. Bahrain signals readiness to adopt minimum corporate tax for large MNEs.
🚬 Excise Tax Expansion
Potential expansion of excise tax to include sweetened beverages and additional categories. Revenue from excise continues to grow.
💼 SME Support
Government reaffirms Tamkeen support for SMEs — wage subsidies, training grants, and streamlined business setup procedures.
Action Items for Businesses
- Review VAT compliance — expect increased audit activity
- Assess Pillar Two exposure if group revenue exceeds €750 million
- Monitor excise tax expansion announcements
- Leverage Tamkeen programs while available
- Plan for potential new compliance requirements