Oman

Double Tax Avoidance Agreements (DTAAs) and Economic Partnership Agreements

Royal Decree 45/2026 ratifies the agreement signed on 19 May 2025 between Oman and Belarus to establish a Joint Committee for Cooperation and Investment.  

The governments of the Sultanate of Oman (“Oman”) and the Republic of India (“India”) have signed a Comprehensive Economic Partnership Agreement (“CEPA”) on Thursday, 18 December 2025. This significant landmark agreement between the two nations, launching duty-free and liberalized trade provisions, follows multiple rounds of negotiations conducted between November 2023 and August 2025. 

On 15 December 2024, the Sultanate of Oman and the Republic of Tanzania (‘the contracting states‘) signed a DTAA. The date that this agreement goes into effect is subject to completion of administrative procedures. 

Digital Tax Stamps

The Oman Tax Authority (OTA) had previously implemented the Digital Tax Stamp system for excisable products, including cigarettes, shisha, and other tobacco products. In July 2023, the OTA aimed to expand this system to encompass carbonated drinks, energy drinks, and sweetened beverages. However, this initiative was subsequently suspended. In October 2024, the OTA decided to enforce the provisions for carbonated beverages, sweetened beverages, and energy drinks, effective from 1 February 2025.

Pillar Two

On 31 December 2024, Oman announced the implementation of a minimum top-up tax of 15% on multinational enterprise (MNE) groups in line with global rules to combat base erosion and profit shifting. This step is taken as a commitment to Pillar Two, which aims to ensure an appropriate level of tax is paid by MNEs through a series of measures aimed at modernising the international tax system. Further details are awaited through the Executive Regulations

Special Economic Zones

Two new Special Economic Zones have been established in Oman:

• Governorate of Dhahirah (Royal Decree 87/2025).
• Rawdah (Royal Decree 88/2025).

These zones are governed by the newly issued Law of Special Economic Zones and Free Zones (Royal Decree 38/2025), which sets out the regulatory framework, incentives, and exemptions available to entities operating within these zones. The law provides for tax exemptions for enterprises and operators in these zones, including exemption from all types of taxes imposed by the Income Tax Law for a period of ten years (renewable for certain activities), subject to specific exclusions (e.g. banks, insurance companies, telecoms, and certain transport companies). Customs exemptions and other investment protections are also included.

Royal Decree 50/2026 establishes an Artificial Intelligence (“AI”) Special Zone in the Governorate of Muscat. Projects established in the zone are granted incentives, advantages, exemptions, and facilities under the Special Economic Zones framework. 

Donations

The Tax Authority has issued Decision 313/2025, amending the Executive Regulation of the Income Tax Law. Notably, donations (in cash or in kind) to waqf establishments (charitable endowments) established under the Law of Awqaf are now recognised as deductible for tax purposes.

Establishment of the International Financial Centre of Oman
(IFCO)

Through Royal Decree 8/2026, Oman has launched IFCO, a landmark initiative positioned in Madinat Al-Irfan and designed to function as a globally competitive financial jurisdiction with its own legal, regulatory, and judicial ecosystem. The Centre enjoys full legal personality and administrative and financial independence, operating under the oversight of the Deputy Prime Minister for Economic Affairs. IFCO introduces a specialised regulatory authority and an autonomous dispute-resolution tribunal, offering modern commercial courts and arbitration frameworks modelled on leading international financial centres. 

E-invoicing rollout

Digitalising Compliance and Transparency The Oman Tax Authority accelerated the rollout of its eInvoicing programe, “Fawtara,” targeting the Top 150 businesses in the first phase. The initiative adopts the advanced Five-Corner Model, requiring electronic invoices to be validated and exchanged via accredited service providers. The phased implementation, running through 2028, aims to streamline compliance, improve data quality, and foster a more transparent tax environment. The OTA’s collaborative approach includes readiness surveys, technical workshops, and ongoing industry consultation, ensuring businesses are equipped for the transition.