Oman will reportedly lower income tax for small and medium enterprises (SMEs) in the time period of 2020-21, and provide long-term residency permits to foreign investors.
The plans are part of Oman’s Vision 2040, which aims to diversify the economy away from oil that accounts for the majority of the kingdom’s revenue, as per the reports.
According to the official statements, 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.
Furthermore, income tax will also be lowered for businesses that will start operating this year in sectors aimed at economic diversification. The kingdom will also cut rent at the Duqm Special Economic Zone and industrial areas until the end of 2022.
In his previous statement, Mr. Khalid bin Saif Al-Busaidi, Director of media and communications at the Omans’ Ministry of Finance, has noted that while the finance and economy ministries expressed the same goals of reducing the deficit through spending cuts and increasing non-oil revenues, they were also committed to improving economic activity and growth, as well as creating jobs, especially in SMEs.
Oman’s economy is one of the weakest in the Gulf region, which has been hit hard by the coronavirus pandemic and low oil prices. Last month, the International Monetary Fund (IMF) has predicted that the economy will contract by 6.4 percent in 2020 and grow by 1.8 percent this year.