Tax advisory for farms, food manufacturers, restaurants, and grocery retailers.
Farming inputs — standard-rated. Agricultural land lease — exempt. Livestock sales — zero-rated (basic food). Fish farming — zero-rated products. Agricultural equipment import — 5% customs duty.
Restaurant meals — standard-rated at 10%. Takeaway food — standard-rated. Catering services — standard-rated. Basic food items (bread, rice, meat) — zero-rated. Processed/luxury foods — standard-rated.
Food processing — output depends on product classification. Raw ingredient purchases — input VAT recoverable. Export of food products — zero-rated. Packaging materials — standard-rated input.
Bahrain's zero-rated food list includes over 90 basic food items: bread, rice, flour, fresh meat, poultry, fish, eggs, milk, fresh vegetables, fruits, baby formula, and cooking oil. All other food items are standard-rated at 10%. The boundary between zero-rated and standard-rated is critical — flavoured milk is standard-rated while plain milk is zero-rated.
We help food businesses navigate the zero-rate vs standard-rate maze.
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