Oman's Tax Authority issued Decision 224/2026 on September 22, 2026, published in Official Gazette 1667 on September 27, 2026, setting value added tax at 0 percent for medicines, herbal and biological preparations, health products, foods for medical use, and medical equipment listed in its annex. The decision applies from October 1, 2026 and repeals the previous zero-rate list, Decision 59/2021.
Oman pharmacies and hospital pharmacies, importers and distributors of medicines and medical equipment, medical-device and dental-equipment suppliers, and VAT-registered producers of foods for medical use must charge 0 percent VAT on the annex-listed supplies from October 1, 2026, but only where the Ministry of Health has issued a release permit for the customs code. A supply charged at the 5 percent standard rate that the annex zero-rates, or a zero rate claimed without a Ministry of Health release permit or outside the annex codes, is an incorrect VAT return.
What changes from October 1, 2026?
Article 1 of Decision 224/2026 zero-rates six categories of supply: medicines, herbal medicines, biological preparations, health products, foods for special medical uses, and medical equipment. Each must carry a Ministry of Health release permit issued for its customs code, and each is listed by customs tariff line in the decision's annex, which carries 677 lines for human medicines and medical equipment. The decision is issued under the Value Added Tax Law (Royal Decree 121/2020), which sets the 5 percent standard rate and empowers the Tax Authority to designate zero-rated supplies.
Article 2 repeals the older zero-rate list in Decision 59/2021 together with any conflicting provision, and Article 3 fixes application from October 1, 2026. An English translation is published alongside the Arabic text. The decision forms part of a three-decision package, with Decisions 223/2026 (veterinary medicines) and 225/2026 (foodstuffs) covering the remaining zero-rated tariff lines from the same date.
| Zero-rated category | Condition for the 0 percent rate |
|---|---|
| Medicines and herbal medicines | Ministry of Health release permit for the customs code |
| Biological and health preparations | Ministry of Health release permit for the customs code |
| Foods for special medical uses, including infant foods for medical conditions | Ministry of Health release permit for the customs code |
| Medical and dental equipment | Ministry of Health release permit for the customs code |
Who must apply the zero rate?
The obligation falls on every VAT-registered supplier of the listed goods into the Omani market: pharmacies and hospital pharmacies supplying human medicines; importers and distributors of medicines and medical equipment into Oman; medical-device suppliers and dental-equipment distributors; and producers of foods for medical use and infant foods for medical conditions sold in Oman. The release-permit condition ties the zero rate to Ministry of Health clearance of the specific customs code, so the same product can be standard-rated or zero-rated depending on whether it carries a permit. Suppliers who relied on Decision 59/2021 must recheck their codes against the new annex, because the set of qualifying tariff lines has changed.
What must suppliers do before October 1, 2026?
- Map each SKU to its customs tariff code and check it against the 677-line annex to Decision 224/2026.
- Confirm that a Ministry of Health release permit exists for every customs code you intend to zero-rate.
- Remove the Decision 59/2021 codes from billing and ERP systems, because that decision is repealed.
- Configure ERP, billing and e-invoicing systems to charge 0 percent on qualifying codes and 5 percent on the rest.
- Reclassify any product that moved category between the 59/2021 and 224/2026 lists.
- Brief pharmacy, procurement and invoicing staff on the release-permit test before the October 1, 2026 cutover.
What happens if the rate is wrong?
The Tax Authority assesses VAT returns against the codes and permits in force. Two errors follow from getting the rate wrong: charging 5 percent on a supply the annex zero-rates, or claiming 0 percent on a code without a Ministry of Health release permit or outside the annex. Both produce an incorrect VAT return and the wrong output-VAT figure. Continuous, per-jurisdiction monitoring surfaces a change like this the moment the Official Gazette publishes it.
Before October 1, 2026, verify each product against the annex and the Ministry of Health release-permit register, lock the 0 percent and 5 percent split in your billing system, and brief the pharmacy and finance teams on the cutover.
