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Tue 30 Dec 2014 01:58 PM

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Oman rejects proposal to tax expats' remittances

Economic committee of the State Council blocks plan that would have added $155m to Oman’s coffers.

Oman rejects proposal to tax expats' remittances

A proposal in Oman to impose a tax on remittances by expats in the country has been rejected by the economic committee of the State Council, according to an official.

"The Majlis Al Shura's proposal to impose a tax on remittances by expatriates was rejected at the State Council," Salim bin Said Al Ghatami, the head of the economic committee at the State Council, told the Times of Oman.

"It is not the right time to impose a tax just on working expatriates. It's not practical. It doesn't go well with the trade practices,” he added.

Al Ghatami said it was felt that imposing the tax would also affect future investment in Oman.

“Imposing such a tax on a certain category of expatriates doesn't meet the international agreements signed by the Sultanate with other countries. It will also affect investment prospects in Oman," he said.

Al Ghatami said the government should find ways of encouraging expats to spend money in Oman, rather than taxing any outflow of money.

“The imposition of tax should be examined by expert committees before it is implemented," he added.

The recommendations of the economic committee will now be forwarded to the higher authorities.

In November, the economic and financial committee of the Shura Council, a consultative body, recommended Oman should tax the billions of dollars which foreign workers send back to their home countries every year. It was proposed that the tax should be set at 2 percent.

The proposed tax would have affected about 1.5 million migrant workers, mostly from south and southeast Asia, who send money home from Oman.

It was estimated that the tax would have added $155m to Oman’s coffers.

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