Expat Taxation Guide in Oman: A Comprehensive Overview
In the heart of the Gulf, Oman continues to make strides in its economic development, attracting foreign investors with its favourable business environment and residency programmes.
One such programme is the Investor Residency Programme (IRP), offering renewable visas lasting either 5 or 10 years for investors and retirees. To qualify for the 10-year IRP visa, one typically needs to invest OMR 500,000 (around US$1.3 million) or more, which can be in Omani property, an Omani company, or government bonds. Alternatively, setting up a company that hires at least 50 Omanis can also qualify one for the 10-year IRP visa. Retirees over 60 with a proven income of OMR 4,000 per month can also apply for the five-year IRP option.
Oman's economic shift is centred around knowledge, technology, logistics, and private-sector innovation, alongside a wave of legal, regulatory, and tax reform. The country doesn't currently have a general income tax that applies to individuals' salaries or wages for both citizens and expats. However, a draft income tax law aimed at high earners has passed Oman's Parliament and is awaiting final review. If implemented, Oman would become the first GCC nation to introduce personal income tax.
The commercial instinct of Oman evolved in the modern era, underpinning its transformation into one of the Gulf's success stories. Much of Oman's progress occurred during the 50-year reign of Sultan Qaboos bin Said, who opened the country to the world while preserving its cultural authenticity. Oman has a long history of commerce and trade, dating back to ancient Majan and extending to its 18th-century empire.
Oman's economic diversification is evident in its new Foreign Capital Investment Law, enacted in 2020, which removed legacy restrictions and allows 100% foreign ownership across a broad range of sectors. Expats are also allowed to own property in specific areas called Integrated Tourism Complexes (ITCs) in Oman.
In 2021, Oman introduced Value Added Tax (VAT) at a flat 5%. The VAT exempts essentials like food, medicine, education, and housing. Labour reforms followed in 2023, modernising employment regulations and making it easier for foreign companies and workers to operate legally and securely.
The planned income tax system in Oman, starting January 1, 2028, will affect natural persons (individuals) by imposing a personal income tax for the first time in the Sultanate. Sultan Haitham bin Tariq, the current ruler, continues the legacy of his predecessor, focusing on diversification, sustainability, and foreign investment.
Muscat, the capital of Oman and the main political, economic, and administrative centre, serves as the hub for these transformative changes. With its rich history, modern infrastructure, and welcoming business environment, Oman offers a unique investment opportunity for those seeking to be part of its continued success.
