The Oman Tax Authority has introduced a new standard floor price for cigarettes and shisha to determine the 100% excise tax on tobacco, effective 1 October 2026.
- Tax Authority Decision No. 206/2026 was published in Official Gazette issue 1665 on 13 September.
- The mandate was signed by Tax Authority Chairman Nasser bin Khamis bin Ali Al Jashmi on 7 September 2026.
- New rules set reference prices for tobacco products to calculate the 100% excise tax.
- Nicotine cessation products remain exempt from excise taxes.
Under the new regulations,
the reference price for a 20-stick pack of cigarettes cannot be less than RO 1.000. For shisha or ready-to-use tobacco,
the standard price is set at a minimum of RO 2.500 per 250 grams. Proportional pricing will apply to other sizes, such as a 500g tin of shisha, which carries a minimum reference value of RO 5.000. These prices serve as the base for excise calculations; tax authorities will compare the actual retail price against these floors and levy a 100% excise tax on the higher of the two figures.
The policy change is expected to impact Oman's 1.45 million expatriates, as reported by the National Centre for Statistics and Information in mid-2026. Data from the September NCSI Household Income and Expenditure Survey notes that
the average non-Omani household spends RO 402.48 monthly, with 48% allocated to housing and utilities. Importers and distributors are required to adjust invoices to reflect these standards, and digital tax stamps will be cross-checked against the new values.
In contrast,
nicotine cessation products—including gum, patches, tablets, sprays, nasal drops, and injections—remain exempt from excise taxes following Ministerial Decision No. 192/2026, which has been in force since August 2026. These products are no longer classified under Chapter-24 tobacco derivatives. The regulatory framework relies on Royal Decree 23/2019 and Ministerial Decision 112/2019. Stakeholders are advised to monitor retail shelf prices in areas such as Al Ghubra, Ruwi, Sohar, and Salalah, as well as updated recommended retail prices from major distributors.
