Adedapo Adesanya
By Adedapo Adesanya
Oman has announced plans to reduce income taxes for small and medium enterprises (SMEs) as well as give long-term residency permits to foreign investors.
According to state television, the new proposals are part of Oman’s Vision 2040 which aims to diversify the oil-dependent economy away from the commodity which accounts for the majority of the country’s revenue.
Oman’s economy is one of the poorest in the Gulf, having been hit hard by the coronavirus pandemic and low oil prices.
Last month, the International Monetary Fund (IMF) predicted that the economy will contract by 6.4 per cent in 2020, with a moderate rebound to 1.8 per cent growth this year.
Income tax will also be lowered for businesses that will start operating this year in sectors aimed at economic diversification.
Until the end of 2022, Oman will also reduce the rent in the Duqm Special Economic Zone and industrial areas.
It said granting longer residencies for foreign investors would be done “in accordance with specific controls and conditions that will be announced later after their study is completed by the Council of Ministers, in addition to incentives related to the market.”
The cabinet also approved a long-term urban growth strategy that “is considered a key enabler for achieving Oman Vision 2040,” state TV said citing Oman’s ruler, Sultan Haitham bin Tariq al-Said.
The Gulf states have started to diversify their economies with stiff competition rising among the seven states of Bahrain, Kuwait, Iraq, Oman, Qatar, Saudi Arabia and the United Arab Emirates (UAE), which has relaxed its conservative stance to attract more investors.
