Latest news with #multinationalTax
The National
a day ago
- Business
- The National
Kuwait reveals rules for new multinationals tax and expects to raise $819m from it annually
Kuwait has revealed executive regulations for its tax on multinational entities in the country and expects the levy to add 250 million Kuwaiti dinars ($819 million) in revenues annually. The country's Ministry of Finance said the new regulations clarify details about the introduction of a supplementary domestic minimum tax (DMTT) under the multinational entities (MNEs) group tax. They "aim to interpret and clarify the provisions of the law, define procedures and implementation mechanisms, enhance transparency, and provide a clear understanding for relevant parties in line", the ministry said early this week. The tax rate was not specified, but the country had said in December that it was planning to impose a 15 per cent tax on multinationals in the country. The new legislation reflects Kuwait's strategy to diversify revenues away from the oil sector, said Noura Sulaiman Al-Fassam, Minister of Finance and Minister of State for Economic Affairs and Investment. The issuance of the regulations "represents a major milestone in the path of economic reform, given their role in providing a fair investment environment and enhancing tax justice", she said. She added that preliminary estimates indicate that the expected annual revenues from the tax could reach about 250 million Kuwaiti dinars, "enhancing the state's ability to build a resilient and sustainable economy". Kuwait's DMTT applies to multinational entities (Kuwaiti or foreign companies) operating in more than one country "whose total revenues meet or exceed annual revenues of €750 million ($885 million) in the consolidated financial statements of the parent entity for at least two of the four tax periods immediately preceding full year 2025", consultancy KPMG said in a note. Multinational entities should register by September 30 of this year, it said. The DMTT is in line with the Organisation for Economic Co-operation and Development's Pillar Two programme, which has set up a global minimum corporate tax to ensure large multinational enterprises pay a minimum 15 per cent tax on profits in each country where they operate. The proposed global minimum tax is expected to result in annual global revenue gains of about $220 billion, or 9 per cent of global corporate income tax revenue, the OECD said in 2023. The UAE last year also imposed the DMTT on large companies as part of changes to its corporate tax law. Large multinational enterprises are to pay a minimum of 15 per cent tax on the profits generated in the UAE (up from the current corporate tax rate of 9 per cent), effective for financial years starting on or after January 1, 2025. The DMTT applies to multinational enterprises with consolidated global revenues of €750 million or more in at least two of the four financial years immediately preceding the financial year in which the tax applies. Bahrain also said in September last year that it would introduce DMTT starting from January 1 on large multinationals. Most Gulf countries are introducing taxes as they seek to diversify their economies away from oil and strengthen non-hydrocarbon revenues. Oman is set to become the first in the region to introduce personal income tax from 2028. The Personal Income Tax Law, which was introduced last month, imposes a 5 per cent tax on annual income exceeding 42,000 Omani rials ($109,236), the Oman News Agency said reported. The law will levy tax on income derived from 'specific income types as defined by the law', the news agency said.
Arabian Business
a day ago
- Business
- Arabian Business
Kuwait introduces tax rules, expects $820m in revenue
The Kuwait Ministry of Finance has issued a landmark decree introducing executive regulations for taxing multinational enterprise (MNE) groups — marking a major step in the country's economic reform agenda and commitment to diversifying income beyond oil revenues. The decree (No. 55 of 2025) implements Law No. 157 of 2024, which brings Kuwait in line with the OECD's Pillar Two global minimum tax framework through the introduction of a Domestic Minimum Top-up Tax (DMTT). According to the Ministry, the new regulation clarifies legal provisions, outlines implementation mechanisms, and enhances transparency in accordance with international best practices. New Kuwait tax rules The Ministry said the move aligns with Kuwait Vision 2035, which aims to build a more diversified and resilient economy. Finance Minister and Minister of State for Economic and Investment Affairs, Eng. Nora AlFusam, said the regulation is pivotal for creating a fair investment environment and enhancing tax justice. She added that expected annual revenues from the tax could reach around KD250m ($820m), helping build a resilient and sustainable economy. The Ministry of Finance will organise a series of awareness workshops to help explain the new tax law and its executive regulations to relevant stakeholders, ensuring smooth implementation and full compliance. The tax applies specifically to large multinational groups operating in Kuwait, in accordance with global tax fairness principles outlined by the Organisation for Economic Cooperation and Development (OECD).
