Oman News / Iran's neighbor made a big announcement, this has never happened in the Middle East

Oman News: The Middle East is currently going through a period of tremendous tension. The bunker buster attack on Iran by the US has raised serious questions about the stability of the region. In this environment, a neighboring country of Iran has made such an announcement, making it the first country in the Gulf region. Neither Saudi Arabia ever made this announcement, nor the UAE, Iraq or Iran itself. This move has brought a new twist in the economic and political strategies of the entire Gulf region.

Oman's historic move

Iran's neighboring country Oman is now going to become the first country in the Gulf to implement income tax from 2028. This announcement has come at a time when instability and geopolitical tensions are increasing in the entire region. According to the Omani government, this new tax will be applicable only to those whose annual income is more than 42,000 riyals (about 1.09 lakh dollars). It will affect only the top 1% of Oman's total population.

Strategy to reduce dependence on oil

Oman's Economy Minister Saeed bin Mohammed al-Saqri said the decision was aimed at reducing economic dependence on oil and maintaining social spending. None of the six Gulf Cooperation Council (GCC) countries have imposed income tax so far. For years, this tax-free policy has attracted high-paid foreign workers to the Gulf region, but Oman has broken this tradition and taken a step in a new direction.

A big step towards economic reforms

Monica Malik, Chief Economist of Abu Dhabi Commercial Bank, described the move as 'limited but historic'. She said the decision shows that Oman wants to stay ahead of regional competition by adopting fiscal reforms, especially when high net worth individuals (HNIs) are increasingly investing in the Gulf region.

Will the rest of the Gulf countries also adopt this path?

Even though Saudi Arabia and Bahrain are expected to be in deficit this year, the IMF believes that as the world's fuel demand is decreasing, Gulf countries may have to adopt options like income tax in the future. Oman is already attracting investment through means like privatization and IPO. Last year, the production unit of its energy company raised $ 2 billion through an IPO.

Oman's decision is an example

The initiative taken by Oman regarding the tax system in the Gulf region not only shows maturity in its economic thinking but can also give a new direction to the entire GCC region. At a time when there is an atmosphere of war and tension in the Middle East, Oman's decision shows that it has now become inevitable to take difficult but necessary steps for long-term economic stability.