Qatar Has New "Sin Taxes" so Alcohol is Now Really Expensive

On January 1, Qatar announced new taxes. Taxes are pretty rare in this region but in the last while, mostly due to pressure from the oil price dropping, taxes have been introduced across the GCC. The other countries are introducing a 5% VAT. Qatar was going to as well, not that it needed to given it was not running huge deficits, since the other countries in the GCC were introducing the VAT Qatar decided to as well. With the advent of the blockade there was no need for policies that were unified with the other countries so Qatar has postponed implementing a VAT but instead introduced a new tax.

The tax targets specific goods -- soft drinks, energy drinks, alcohol and tobacco. Essentially a "sin tax". And rationale is that the tax will help offset rising healthcare costs due to unhealthy lifestyle choices (alcohol, smoking etc). The tax is huge, upward of 100% on alcohol and tobacco, less (I think 50%) for soda.

So I did something I've not done for a long time, visit a bar in Qatar. I wanted to see what kind of prices the bars were going to have. I went to a place that was more "low end" to get a sense of the base price. Wow!

48 riyal ($US 13.10) for a pint and 42 riyal ($US 11.50) for a bottle! And this wasn't at a 5-star hotel bar, where I will assume it's even more expensive. It's a big jump in price, I think it was around 30 riyal before.

Tobacco has had similar increases. Friends of mine who like to smoke cigars told me that the small box of cigars that they would normally buy for ~250 riyal is now more than 400 riyal.

I do not expect a significant increase to the price of soda. At the store a can is 1.5 riyal ($US 0.40) so if it increased to 2 or 2.5 riyal a can that's not too burdensome.


Smokers and drinkers are I'm sure outraged by the hefty tax but I'm guessing they are here to stay. Alcohol is forbidden in Islam, and tobacco is "makruh" (not forbidden but instead is strongly not recommended) so I doubt many Qataris are going to publicly support removing the tax and thus have their name associated with alcohol and tobacco. Without some support from Qatari citizens the chances of foreigners getting the tax reduced is pretty much nil.

Expensive drinks are here to stay. Drinkers might need to cut back (the whole point of the tax of course).