Oman To Impose Fines Up To RO 20,000, Jail Time For Income Tax Defaulters
The law, which applies to individuals earning over RO 42,000 annually, the top 1 per cent of earners in the country, features a two-tiered penalty system for non-compliance, designed to ensure transparency and deter tax evasion.
Under Article 65, individuals who fail to file their tax returns, disregard official notices from tax authorities, or delay payment without valid justification face administrative fines ranging from RO 1,000 to RO 5,000.
For more serious infractions, Article 66 provides for criminal penalties. Those found guilty of submitting false declarations, concealing income, or falsifying tax records could face prison sentences ranging from one to three years and fines between RO 10,000 and RO 20,000.
The legislation, announced in June 2025, represents a critical component of Oman's fiscal reform agenda and its Vision 2040 plan, aimed at reducing reliance on oil revenues and strengthening state finances.
Minister of Economy Said bin Mohammed Al Saqri has previously emphasised the country's vulnerability to global oil price volatility, noting that oil and gas still account for up to 85 per cent of public income.
Tax experts say the inclusion of criminal penalties for non-filers signals the government's intent to implement the new system with a high degree of seriousness and compliance oversight.
The law gives Omani tax authorities broad powers to investigate discrepancies and enforce penalties, setting a precedent in a region historically known for tax-free personal income policies.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Gulf Insider
21 hours ago
- Gulf Insider
Oman To Impose Fines Up To RO 20,000, Jail Time For Income Tax Defaulters
As Oman prepares to implement the Gulf's first personal income tax in January 2028, authorities have outlined strict enforcement measures, including fines reaching up to RO 20,000 and prison terms for violators. The law, which applies to individuals earning over RO 42,000 annually, the top 1 per cent of earners in the country, features a two-tiered penalty system for non-compliance, designed to ensure transparency and deter tax evasion. Under Article 65, individuals who fail to file their tax returns, disregard official notices from tax authorities, or delay payment without valid justification face administrative fines ranging from RO 1,000 to RO 5,000. For more serious infractions, Article 66 provides for criminal penalties. Those found guilty of submitting false declarations, concealing income, or falsifying tax records could face prison sentences ranging from one to three years and fines between RO 10,000 and RO 20,000. The legislation, announced in June 2025, represents a critical component of Oman's fiscal reform agenda and its Vision 2040 plan, aimed at reducing reliance on oil revenues and strengthening state finances. Minister of Economy Said bin Mohammed Al Saqri has previously emphasised the country's vulnerability to global oil price volatility, noting that oil and gas still account for up to 85 per cent of public income. Tax experts say the inclusion of criminal penalties for non-filers signals the government's intent to implement the new system with a high degree of seriousness and compliance oversight. The law gives Omani tax authorities broad powers to investigate discrepancies and enforce penalties, setting a precedent in a region historically known for tax-free personal income policies.
Daily Tribune
6 days ago
- Daily Tribune
Bahrain Gets Digital Boost as Oman Tech Giant Expands Reach
A major tech breakthrough for Bahrain's consumer market is on the horizon, with the announcement that MHD-ITICS, a leading technology division under Oman's Mohsin Haider Darwish Group, will expand its Consumer Division into the Kingdom. The move was revealed at OERLive DX 2025, Oman's premier digital transformation conference, held in Muscat on June 25th. MHD-ITICS will operate in Bahrain through Mohsin Haider Darwish for Consumer Services W.L.L, promising a new wave of innovation-driven, high-quality products and services aimed at enhancing everyday living. Strategic Momentum This development places Bahrain firmly on the regional map of the growing digital economy. Drawing on its legacy of strategic partnerships and deep industry experience, MHD-ITICS' entry is expected to offer consumers in Bahrain access to some of the region's most advanced tech solutions in smart devices and digital services. The Bahrain announcement stood out at the DX 2025 conference, themed 'Transforming Oman Through Intelligent Technologies'. The event brought together high-ranking officials and digital pioneers aligned with Oman's Vision 2040, underscoring the region-wide ambition to become a global digital hub. Powerful Collaborations Organised by United Media Services, the conference featured top voices from Oman's Ministry of Transport, Communications and Information Technology, Oman Chamber of Commerce and Industry, and ITHCA Group. These bodies are championing strategic initiatives such as the 'Tahawul' Government Digital Transformation Programme, which has made Muscat the most digitally mature governorate in Oman. Among the speakers were Atulya Sharma, CEO of United Media Services; Dr. Abdullah Al Rashdi, Digital Transformation Advisor; and Dr. Amjed Al Thuhli, Vice Chairman of the Digital Economy & AI Committee. They outlined how artificial intelligence, cybersecurity, and cloud solutions are shaping economic transformation. Industry Insights The conference also spotlighted emerging sectors and featured panels with technology and finance leaders from firms including Infoline, SSA Consulting Group, National Finance, and Dhofar Insurance. They explored how digital tools are improving efficiency, security, and customer experiences. Bahrain-based audiences were also among those reached through The Daily Tribune, which served as one of the official media partners for the event, alongside ZiBi in Zanzibar and Alam Al Iktisaad. As MHD-ITICS prepares to launch in Bahrain, the expansion signals deeper integration between GCC economies in tech development and service innovation, reinforcing the Kingdom's role in regional digital transformation.
Gulf Insider
30-06-2025
- Gulf Insider
High Income Earners Evading Tax To Face Jail term, Hefty Fines: Oman
Underreporting income, overreporting expenses through false deductions, and misrepresenting assets for high Omani earners can lead to jail term of up to three years and maximum fine of 20,000 riyals. That came after Oman enacted its first Personal Income Tax Law, with implementation set for January 1, 2028, aimed at fiscal diversification and economic sustainability under Vision 2040. The new law, issued by Royal Decree No. 56/2025 by Sultan Haitham bin Tarik, will apply a 5% tax rate on individuals earning over OMR 42,000 annually. This high exemption threshold means approximately 99% of Oman's population will not be affected, according to the Tax Authority. According to the official Gazette, it's prohibited for a person to use fraudulent methods or engage in commercial or financial transactions during any tax year with the aim of achieving illegal tax gains in violation of the provisions of this law. Such gains include avoiding, reducing, deferring the payment of tax due, avoiding or reducing potential tax due, shifting the tax burden to another person. avoiding the obligation to calculate, deduct, or withhold tax, and unlawfully recovering the tax due, or more than its value. The regulations specify the administrative penalties that the President may impose on anyone who violates the provisions of this law and the regulations, provided that the fine does not exceed 5,000 riyals. Additionally, anyone who commits any of the following acts in violation of the provisions of this law shall be punished by a fine of no less than 1,000 riyals and no more than 5,000 riyals: Intentionally refrains from submitting a tax return within the prescribed deadlines. Intentionally refrains from implementing the Authority's request to submit records, documents, data, information, invoices, or other tax-related matters. Intentionally refrains from deducting amounts required to be deducted for the tax account. Intentionally refrains from paying amounts deducted for the tax account. Anyone who commits any of the following acts in violation of the provisions of this law shall be punished by imprisonment for a period of no less than one year and no more than three three years, and a fine of no less than 10,000 riyals and no more than 20,000 riyals, or by either of these two penalties: Knowingly submits false information in the tax return. Knowingly attaches false records, documents, information, data, invoices, or other information to the tax return. Intentionally destroys, conceals, or disposes of records, documents, information, data, invoices, or other information before the expiration of the specified period for their retention. Without prejudice to the criminal liability of natural persons, a legal entity shall be punished by a fine equivalent to twice the maximum penalty prescribed for the crime if the crime was committed in its name or on its behalf by its chairman, a member of its board of directors, its manager, or any other official acting in that capacity, or with its consent, cover-up, or gross negligence. The same penalty shall apply to anyone who incites, assists, or agrees with another to commit any of the crimes stipulated in this law. The penalty prescribed for the crime shall be doubled, both its maximum and minimum, in the event of repeating. No public action may be initiated, filed, or any action taken in connection with the crimes stipulated in this law, except upon the request of the President. The President may reach a settlement in the crimes stipulated in this law, at any stage of the public action and before a final judgment is issued, provided that the accused pays the amounts due to the Authority, in addition to an amount equal to half the maximum penalty fine prescribed for the crime. In all cases, the settlement shall result in the dismissal of the public action arising from the aforementioned crimes. The new individual income tax comprises 76 articles across 16 chapters, the law will target specific income sources while integrating social exemptions—such as education, housing, healthcare, zakat, and donations—to ensure fairness and social justice. The move complements Oman's long-term fiscal consolidation strategy and aims to increase non-oil revenues to 18% of GDP by 2040. The law's executive regulations will be issued within a year of publication in the Official Gazette. The Tax Authority is also deploying an electronic tax compliance system, integrating government databases to ensure accuracy in declarations and promote voluntary compliance. Last year, Oman collected OMR 1.4 billion from corporate, VAT, and selective taxes. The personal income tax is expected to complement these revenues and bolster fiscal credibility, enhancing Oman's appeal to global investors. This landmark policy comes amid a regional trend of Gulf economies moving toward diversified revenue models as they reduce dependency on oil.
