KPMG seminar to focus on changes to Income Tax Law

KPMG is organising a one-day tax seminar tomorrow, March 6, 2017, at Crowne Plaza Muscat to provide Senior C-suite professionals with an update on the sweeping changes which have been introduced to Oman’s income tax law by Royal Decree 9/2017 issued on February 19, 2017 and published in the Official Gazette on February 26, 2017.

Ashok Hariharan, Partner and Head of Tax for KPMG Lower Gulf, mentioned that the amendments, which are essentially centred on the objective of enhancing revenues from taxes through multiple measures, have far reaching impact on Oman’s income tax framework and give rise to many uncertainties on which the tax payers at large would require clarity.

Significant amendments, whose analysis, impact and uncertainties will be addressed in the seminar include scope of withholding tax on fees for services, interest payments and dividends on shares.

The seminar will consider several domestic and international tax scenarios and real life situations like cost sharing arrangements, secondments of staff, revenue and risk sharing arrangements and discuss the impact of the changes on them.

According to Ashok, the latest amendments may result in increasing the costs of businesses operating in Oman, given that many foreign taxpayers will expect the taxes imposed on their incomes to be borne by local businesses. Taxing dividends and interest income earned by foreign tax payers will reduce their return on investment.

Taxing interest income earned by foreign persons could impact the cost of borrowing if lenders pass on the cost to local businesses.

Ashok also mentioned, given the thrust towards greater compliance with stricter penalty provisions being introduced, it is imperative that companies give tax management their top priority.