Oman Advances Personal Income Tax Law, Setting a Precedent for GCC Tax Reforms Oman

Oman is making significant strides towards diversifying its economy with the introduction of a personal income tax (PIT), a move that could set a precedent for other GCC countries. The Omani Shura Council has advanced a draft law proposing personal income tax, which targets high-income earners, including wealthy Omanis and high-earning foreign workers. This proposed tax, expected to be implemented in 2025, aligns with Oman’s Vision 2040 goals of reducing reliance on oil revenues and boosting economic sustainability through diversified income streams. The tax rates being considered are between 5% and 9%, focusing primarily on global incomes over $1 million for citizens and Oman-sourced incomes above $100,000 for foreigners.

This progressive tax initiative is poised to enhance fiscal discipline, support public services, and ensure long-term economic stability in the face of fluctuating oil prices. As Oman moves forward with this policy, it remains to be seen whether other GCC nations will follow suit, considering their current economic strategies aimed at attracting international businesses and talent.