Economics
Oman to Break Gulf’s Income Tax Taboo to Curb Deficit
- Oman to levy income tax on high earners starting 2022
- Sultanate has the Gulf’s biggest budget deficit amid low oil
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Cash-strapped Oman plans to take a step unheard of in the Persian Gulf region: It’s going to start taxing the income of wealthy individuals beginning in 2022, as part of a broader program to tackle a budget deficit that’s ballooned due to low oil prices and the coronavirus pandemic.
By reducing government spending while spurring investments, the plan is projected to bring the budget deficit -- estimated to reach nearly 19% of gross domestic product in 2020 by the International Monetary Fund -- to 1.7% by 2024, the Ministry of Finance said in an emailed statement on Sunday. Revenue from the income tax will be used to fund social programs, it said.