Bahrain's Nation Bureau for Revenue (NBR) has published the VAT Transportation Guide, which sets out the general principles of VAT in Bahrain and how they apply for transportation supplies. This includes that for international transportation and certain associated goods and services, the following are zero-rated for VAT purposes:
- The supply of an international transportation service of goods and/or passengers by way of a means of transport;
- Certain services that are directly or indirectly associated with a supply of an international transportation service of goods and/or passengers; and
- The supply of a means of transport and maintaining, repairing and converting a means of transport.
International transportation services of passengers and/or goods are taxable at the zero-rate where the place of supply of such services is Bahrain provided the services are supplied using a qualifying means of transport. Such services will be outside the scope of Bahrain VAT where their place of supply is outside Bahrain. In this respect, the place of supply for international transportation services is where the transportation begins. Where a transportation service has multiple legs or parts, the transport will be considered as beginning where the first leg starts.