A statutory tax-free environment set by the IFC Oman Founding Law, with exemptions available for a period not exceeding fifty years from the date the law comes into force.
The IFC Oman Founding Law establishes that tax exemptions apply for a period not exceeding 50 years from the date the law comes into force. Within that construct, the Minister of Finance may grant additional tax benefits and exemptions to specific IFC Oman Establishments, operating within regulations set by the IFC Oman Board in coordination with competent entities.
The IFC Oman Board is required to issue an IFC Oman Tax Regulation specifying the activities eligible for tax benefits, the conditions attached, and the detailed provisions for applying the exemptions. Until that regulation is issued, the Founding Law provisions are the operative reference.
Three categories of income exemption operate within this construct, each covering a different class of taxpayer — together creating a comprehensive tax-free environment for activities conducted within and with IFC Oman.
The Founding Law sets out three distinct categories of income exemption, each operating differently and covering a different class of taxpayer.
IFC Oman Establishments — entities licensed and operating within IFC Oman.
Income from conducting eligible activities as defined in the IFC Oman Tax Regulation. Exempt when determining taxable income for any tax year.
Juristic persons not resident in Oman, transacting with IFC Oman Authorities or IFC Oman Establishments.
Royalties, R&D fees, software use fees, management or service fees, dividends, and interest. All exempt from Omani tax when arising from such transactions.
Non-Omani natural persons employed by or otherwise in a relationship with IFC Oman Authorities or IFC Oman Establishments.
Income from IFC Oman employment or relationship. The exemption extends to income earned outside the Sultanate of Oman by the same person.
“All three exemptions operate when determining taxable income for any tax year— a formulation that applies the exemptions at source rather than through rebate or retrospective claim.”
For the purposes of Oman’s Value Added Tax Law, IFC Oman is treated as a special zone. The practical consequence is that supplies made within IFC Oman, and supplies made between IFC Oman and outside Oman, are treated as either exempt supplies or supplies subject to VAT at a zero percent rate — rather than the standard 5% Omani VAT rate that applies onshore.
The precise delineation of which supplies are exempt and which are zero-rated will depend on the IFC Oman Tax Regulation and the application of the VAT Law to the specific supply in question. Firms with complex supply chains should take specific VAT advice in the context of their proposed IFC Oman activities.
The IFC Oman Authority exercises the necessary powers to ensure that IFC Oman Establishments comply with their tax obligations under Omani legislation applicable in IFCO, and to implement the tax benefits and exemptions prescribed by the Founding Law.
This is done in accordance with a mechanism agreed between the IFC Oman Authority and the Oman Tax Authority — giving IFC Oman Establishments a single, coordinated interface for compliance rather than parallel obligations in two systems.
Implements the tax benefits and exemptions prescribed by the Founding Law. Ensures IFC Oman Establishments comply with Omani tax legislation applicable within IFCO.
The national tax authority, with which the IFC Oman Authority coordinates on the mechanism for applying tax obligations and exemptions to IFC Oman Establishments.
Maximum horizon for tax exemptions set by the Founding Law
Distinct exemption categories: corporate income, non-resident, personal
Corporate income tax on eligible activity income within IFC Oman
VAT on qualifying IFC supplies — exempt or zero-rated, not the onshore 5%
Move between the statutory exemptions and Oman’s double taxation agreements.
The Founding Law construct, three exemption categories, VAT special-zone treatment, and coordination with the Oman Tax Authority.
Oman's DTA network across South Asia, Africa, Europe, and Asia — and how IFC Oman entities access treaty benefits.
A single point of contact for tax framework guidance, VAT special-zone questions, and coordination with the Oman Tax Authority. The IFC Oman tax desk works with sponsors, in-house tax teams, and their advisers from first conversation through establishment.
