Oman Newsletter - Spring 2018

OMAN DEVELOPMENTS AT A GLANCE

WITH HOLDING TAX

  • Tax authorities declare withholding tax applicable on all payments to foreign persons irrespective of place of performance.

CO-OPERATION WITH OECD

  • Oman joins Base Erosion and Profit Shifting (BEPS) Inclusive Framework of OECD. This action may result in Oman being removed from the EU’s “grey list” of non co-operative tax jurisdictions. 

BUDGET FOR 2018

  • Analysis of Oman’s 2018 budget: Total projected spending will amount to 12.5 billion Omani Rials, an increase of 6.8% against the previous year. Revenues are estimated at 9.5 billion Omani Rials, leaving a budget deficit of 3 billion Omani Rials, a level of 10% of GDP. GDP is budgeted to grow at a rate of 3%.

OMANISATION INCENTIVE FROM EMPLOYING STUDENTS

  • Oman part time work permits and Omanisation – Recently introduced new legislation enabling Omani national school students and retirees to take on part time roles. Private sector companies employing such students and retirees can include them as part of the overall omanisation % requirements.

BRANCH REGISTRATION FACILITATED FOR GCC COMPANIES

  • The Ministry of Commerce and Industry, Muscat, Oman (“MOCI”) has recently confirmed that in recognition of certain economic agreements between Gulf Cooperation Council (“GCC”) member states, it has become possible for companies domiciled in GCC member states and (directly or indirectly) wholly owned by nationals of GCC member states, to establish a branch office in the Sultanate of Oman without the erstwhile pre-requisite of having a contract with a government entity or quasi-government entity. It is pertinent to note that while the said economic agreements (between GCC member states) have been in force for quite some time, MOCI has only now developed an online mechanism (through its “Invest Easy” portal) to make such an application – the previous mechanism required even wholly GCC owned and domiciled companies to furnish a government contract.