GULF COUNTRIES TO LEVY INCOME TAX & VAT
Gulf countries are one of the largest attractions for foreign investors and expatriate workers due to absence of Income Tax and many other tax reliefs. But this scenario would not last too long.
The six Gulf countries are trying hard to meet the deadline for the implementation of corporate and individual income tax by 2012. According to experts, ‘the prospect of drastic reductions in oil revenues and the resultant fiscal deficit has forced the six countries to examine whether implementation can be done earlier than 2012.
The Gulf Co-operation Council’s monetary and tax system is traditional. Levying of income tax & VAT is a first step towards monetary globalization.
Foreign banks are taxed at a rate of 20% on their taxable income in Abu Dhabi, Dubai, & Sharjah. Oil companies pay at a flat rate of 55% on their taxable income in Dubai & 50% in other emirates.
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