Oman

Oman introduced country-by-country (CbC) reporting requirements applicable for reporting years beginning on or after 1 January 2020. Further, please note that, although the Oman Tax Authority (OTA) announced the suspension of 'local filing' requirements for multinational groups headquartered outside Oman till further notice, other obligations (i.e. CbC notification requirements) will continue to apply. 

Oman became the 91st country to sign the Organisation for Economic Co-operation and Development's (OECD's) Multilateral Convention to implement Tax Treaty related measures to prevent base erosion and profit shifting (BEPS) (i.e. the MLI). Oman has ratified the MLI, and the MLI has entered into force from 1 November 2020.

The Central Bank of Oman implemented the Common Reporting Standards (CRS) regime in Oman, setting out rules for automatic exchange of information through the CRS.

On 8 June 2023, Oman and Russia (“the contracting states”) signed a Double Tax Avoidance Agreement (“DTAA”), A Royal Decree (RD 89/2023) was issued on 27 December 2023 by His Majesty the Sultan of Oman, ratifying the DTAA which was published in the Official Gazette on 31 December 2023. Given that Oman and Russia have both ratified and formally notified each other of the completion of the ratification procedures, the DTAA will come into effect in 1 January 2024.

On 22 May 2023, Oman and Egypt signed a DTAA. There is no clarity yet on the terms of the agreement signed; however, we understand that the agreement covers avoidance of double taxation and prevention of income and capital tax evasion. The effective date is yet to be announced. 

In October 2021, the OTA issued Guidelines on the Mutual Agreement Procedure (MAP) Assistance in Oman. These guidelines clarify that: 'Under Oman domestic legislation, there is no suspension of tax collection during the MAP process. However, tax collection may be suspended where, separately, the taxpayer has appealed against an assessment and has paid the undisputed amount of tax. Where applicable, interest and penalties will apply in accordance with the Income Tax Law'.

A DTAA between Oman and Qatar was signed on 22 November 2021 and was ratified by Oman in January 2022. The DTAA was ratified in Qatar as well through Emiri Decree No. 45 of 2022, which was published in the Official Gazette on 9 November 2022. The DTAA has entered into force from 2023.

The OTA also announced suspension of withholding tax (WHT) that was imposed on the lease of ships, aircraft, and aircraft engines, effective from 29 December 2022.

While dividends and interest were initially included in the list of payments made to foreign entities that attract WHT, a Royal Directive issued by His Majesty Sultan Haitham bin Tarik on the occasion of Accession Day on 11 January 2023 called for the complete suspension of WHT on the distribution of dividends and interest on non-resident investors.

The OTA has recently issued value-added tax (VAT) guides on the below topics: 

• VAT Guide for Input Tax: This guide provides clarifications/guidance on key matters relating to input tax credit, especially relating to input tax incurred by employees, blocked input tax, alternative methods for input tax apportionment, administrative practices for claiming input tax based on supplier’s tax invoices, etc.
• VAT Guide for Promotions: This guide provides key clarifications/guidance on various matters in terms of promotion of commercial activities, especially relating to discounts offered to customers, gifts and samples, sale of vouchers, loyalty points, etc.
• VAT Guide for Charities and Non-Profit Organisations: This guide provides guidance to charities/non-profits in Oman and associated suppliers on key matters relating to economic activities carried out by such entities, input tax deduction, exemptions from VAT on imports, issuance of tax invoices, etc.