MUSCAT : Speaking during the Middle East Investor Relations Association (MEIRA) Annual Conference held in Muscat in September, Mahmood Al Aweini, Secretary-General at the Ministry, said the decision is part of a carefully considered strategy and not a hasty move.

Emphasising that the decision is not random, he pointed out that the government has allowed the market sufficient time to prepare and adapt.

The proposed tax will apply a flat 5 percent rate on annual personal income exceeding RO 42,000. It will cover income from employment, business activities, rental properties, and capital gains on securities such as shares, bonds, and sukuk. However, returns from government-issued sukuk and treasury instruments will be exempt. The tax will apply to both Omani citizens and expatriates who reside in the Sultanate for at least 183 days per year.

Al Aweini acknowledged investor concerns about potential impacts on Oman’s capital market but emphasised that the government would take appropriate measures to maintain competitiveness.

“We have tools to respond, if necessary,” he said. “We won’t compromise investor confidence, and at the right moment, we will act to retain our competitive edge.”

The income tax plan was initially scheduled for 2026, but it was postponed following a review by the State Council, which recommended further economic assessment and timing adjustments due to post-pandemic recovery efforts.

The planned income tax would make Oman the first GCC country to implement a direct personal income levy — a significant shift in a region long known for its tax-free incentives for residents and expatriates.

For all the latest news from Oman and GCC, follow us on Twitter, Instagram and LinkedIn, like us on Facebook and subscribe to our YouTube page, which is updated daily.