No tax to be paid (file imagepixabay)
Fears that a 5% value added tax (VAT) would be added to bunker stems made in Mideast Gulf bunkering hub of Fujairah appear to be unfounded, according to a company active in the market.
Singapore-based Oil Marketing and Trading International said it has reviewed the Unified VAT Agreement for the Gulf Cooperation Council and the VAT Implementing Regulations and found that the tax is not applicale to bunkers.
"Bunkers sold to international trading vessels are tax free, but we will monitor the situation and update clients as and when necessary," the company said in an email to Ship & Bunker.
There had been some confusion in the market as to whether or not the VAT tax would be used for bunker fuel sold in the port.
Fujairah, along with Singapore and Rotterdam, is a major bunkering destination for world shipping.