Jordan - Indirect tax rate cuts, update on 2011 – 2014 assessments

Indirect tax rate cuts, update on 2011–2014 assessments

KPMG in Jordan provides updates on reductions to value added tax (VAT), special sales (excise) tax and customs rates for certain items. KPMG in Jordan also highlights the impact of the tax authority’s application of sampling on audits and assessments of corporate income tax returns.

Related content

New reduced VAT rate

As of 19 October 2015, a new reduced value added tax rate of 8 percent applies to:

  • clothes classified under HS codes (Customs Tariff Table) 61 and 62
  • watches classified under HS codes 91.01 and 91.02
  • shoes classified under HS code 64
  • perfumes and cosmetics classified under HS codes 33.03 and 33.04
  • jewelry classified under HS code 71.13
  • toys classified under HS 95.03.

New reduced special sales tax (excise) rate

As of 19 October 2015, a new reduced special sales tax (excise) rate of 8 percent (instead of 25 percent) applies:

  • perfumes and cosmetics classified under HS codes 33.03 and 33.04
  • leather clothes classified under HS code 42.03.

New reduced customs duty

As of 19 October 2015, a new reduced customs duty rate of 5 percent (instead of 10, 20 or 30 percent) applies to:

  • leather bags and clothes classified under HS codes 42.02 and 42.03 
  • shoes classified under HS codes 64.01, 64.03, 64.04, 64.05
  • watches classified under HS codes 91.01, 91.02  and 91.03.

2011 – 2014 corporate income tax return assessments

Following a sampling process, Jordan’s Income and Sales Tax Department accepted as filed 85 percent of corporate income tax returns submitted for the years 2011 – 2014 without amending or auditing these returns. This percentage is the highest in a decade, which may signal that the tax authority’s sampling approach is more rigid than previously and that the tax authority is focusing on the quality of tax audit decisions, rather than quantity. 

MENASA Tax Update - November 2015

The latest news in tax from the Middle East, North Africa and South Asia (MENASA) region.

 
Read more

Connect with us

 

Request for proposal

 

Submit

KPMG's new digital platform

KPMG International has created a state of the art digital platform that enhances your experience, optimized to discover new and related content.