Navigating Tax Objectives and the Future of the Carbon Credit Market in the Gulf Cooperation Council Countries

Investments in carbon offset projects have been growing and are expected to continue to grow, and the carbon credit market is key in advancing the green economy. Carbon credits have tax consequences, one of them being value added tax (VAT), hence it is essential to look into the VAT aspects of carbon credits. This article analyses the evolving nature of carbon credits which led to complications from a VAT perspective. Further, the article addresses whether these credits should be classified as electronic services for VAT purposes or otherwise in Saudi Arabia and the United Arab Emirates.