The income of professionals working in Gulf countries is going to decrease now. In Gulf countries famous for zero income tax, preparations are now underway to collect tax on the income of professionals and Oman has started it.
According to the news, Oman has approved the proposal to levy income tax and is preparing to implement it from next year. Till now, workers and professionals in Oman did not have to pay any income tax. That is, their entire income was tax free. Now the government of Oman is going to levy income tax at the rate of 5 percent to 9 percent on the earnings of workers and professionals.
Parliament approved the proposal last month
The Omani Parliament approved the proposal to collect income tax in July this year. After that, it was sent to the State Council for final approval. In the proposal, different arrangements have been made for Omani citizens and migrant workers and professionals. In the new system, Omani citizens will have to pay less tax, but workers from other countries will have higher tax liability.
This will be the rate of income tax collection
According to the proposal, Omani citizens will be charged income tax at the rate of 5 percent. This income tax liability will be applicable only to those Omani citizens whose annual global income is more than 1 million dollars (about 8.4 crores rupees). On the other hand, workers and professionals from other countries will have to pay tax at the rate of 9 percent if their annual income is more than 1 lakh dollars (about 84 lakh rupees).
The first Gulf country to impose income tax
Oman is the first country among the countries included in the Gulf Cooperation Council (GCC), where income tax is going to be imposed. GCC countries are also known as Gulf countries. Gulf countries have been considered tax havens due to zero income tax. However, now this is changing. After Oman imposed income tax, there is talk of ending the system of zero income tax in Kuwait as well. At the same time, countries like Saudi Arabia and United Arab Emirates still want to move forward on the tax-free system.
6 lakh Indians are likely to be affected
This change in Oman is expected to have a huge impact on the Indian people. Around 6 lakh Indians are currently living in Oman and are engaged in various professions. Indians working in Oman are sending about 27 thousand crore rupees to India every year in the form of remittance. Now their income is going to be affected due to the imposition of income tax, which can also affect remittance.
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