Oman has announced its plans to become the first Gulf nation to impose an income tax on its citizens, Bloomberg said on Monday, Report informs.
This strategic move is Oman's efforts to reduce its dependence on earnings from its crude oil exports.
Sultanate of Oman's Minister of Economy, Said bin Mohammed Al-Saqri, highlighted the need for the nation to diversify its public revenues to reduce reliance on oil income while maintaining the social spending levels.
The government has decided to impose a 5 per cent income tax on people of the nation who have an annual income of 42,000 rials ($109,000) or above, according to the agency report. However, this will not be in effect until 2028, as per a local media outlet.
The ministry also said that this move will mean that the top 1 per cent of the economy's earners will have to pay tax in Oman, as per the report.
According to Bloomberg, no other Middle Eastern Gulf country that is part of the Gulf Cooperation Council (GCC) has income tax on its citizens.
Nations like Saudi Arabia, the United Arab Emirates, and Qatar, apart from earning high revenues from oil exports, also earn from foreign workers. Oman's move to impose an income tax on its citizens is expected to be closely monitored by the neighbouring Middle Eastern nations.