Latest news with #PersonalIncomeTaxProject
Observer
6 days ago
- Business
- Observer
Personal Income Tax Law to Take Effect in 2028
Muscat: The Personal Income Tax Law issued by Royal Decree No 56/2025 consists of 76 articles distributed across 16 chapters. The law will impose a 5% tax on the taxable income of natural persons whose gross annual income exceeds RO 42,000, derived from specific income types as defined by the law. The law will come into effect at the beginning of 2028. The Tax Authority said that the Personal Income Tax Law complements the tax system in line with Oman's economic and social conditions and aligns with the role assigned to the Tax Authority. It also contributes to the objectives of Oman Vision 2040 by diversifying income sources and reducing reliance on oil revenues, with targets of 15% of GDP by 2030 and 18% by 2040. Additionally, the tax aims to promote wealth redistribution among societal segments, enhancing social justice, while supporting the state budget and specifically financing part of the social protection system. The Authority also affirms that the implementation of the personal income tax follows an in-depth study assessing its economic and social impact, based on income data from various government entities. The study established a carefully considered exemption threshold, revealing that approximately 99% of Oman's population will not be subject to this tax. Notably, the exemption threshold is set high at RO 42,000, and the tax rate is low at 5%. The law also includes deductions and exemptions accounting for social considerations in the Sultanate of Oman, such as education, healthcare, inheritance, zakat, donations, primary housing, and other factors. Karima Mubarak Al Saadi, Director of the Personal Income Tax Project, confirmed that all necessary preparations and requirements for implementing the tax have been completed. The executive regulations of the law will be issued within one year of its publication in the Official Gazette. She told Oman News Agency (ONA) that an electronic system has been developed by the Tax Authority to promote voluntary compliance and has been linked with the departments concerned to ensure accurate income calculation and verification of tax declarations. The Tax Authority has also strengthened its workforce through specialized training programs in line with the tax implementation requirements. Additionally, guidance manuals for natural and legal persons will be published according to a predetermined schedule.
Gulf Insider
7 days ago
- Business
- Gulf Insider
Oman To Impose First Personal Income Tax For High Earners, Effective January 2028
Oman has officially enacted its first Personal Income Tax Law, with implementation set for January 1, 2028, marking a historic policy shift 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. Comprising 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. Enforcement Date : January 1, 2028 : January 1, 2028 Tax Rate : 5% : 5% Exemption Threshold : OMR 42,000 per year : OMR 42,000 per year Impact : Only top 1% of earners affected : Only top 1% of earners affected Goals : Revenue diversification, fiscal stability, improved credit ratings : Revenue diversification, fiscal stability, improved credit ratings Social Protection: Revenue to support Oman's social protection system 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. Karima Mubarak Al Saadi, Director of the Personal Income Tax Project, noted that training, infrastructure, and legal frameworks are already in place. Educational guides for individuals and businesses will be rolled out in phases ahead of the law's implementation. 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.
