Oman announces tax and finance incentives to boost joint-stock companies

Dubai: Oman has introduced a new package of tax and financing incentives aimed at encouraging limited liability companies to convert into closed joint-stock companies, as part of efforts to deepen the capital market and strengthen corporate growth. 

The incentive package includes a two-year exemption from one-third of income tax, fast-track access to financing through the Development Bank, a 10 per cent price preference in government tenders, the option to pay income tax in instalments, and a six-month exemption from value-added tax. 

To qualify, companies must have a minimum capital of RO 500,000, employ at least 20 Omani nationals or meet approved Omanisation ratios, and comply with VAT requirements, conditions designed to promote sustainable growth and long-term economic stability in the Sultanate.

The initiative, led by the Ministry of Commerce, Industry and Investment Promotion (MoCIIP) in coordination with relevant authorities, seeks to improve competitiveness, governance and long-term sustainability across targeted sectors.

The programme aligns with high-level directives to enhance the national business environment and support companies with the potential to expand and scale. 

MoCIIP has actively promoted the incentives through field visits and awareness meetings held via branches of the Oman Chamber of Commerce and Industry in several governorates, encouraging firms to either convert their legal status or establish new closed joint-stock entities under the scheme.

According to Oman News Agency, these efforts have already led to tangible results, with seven limited liability companies converting into closed joint-stock companies and 10 new closed joint-stock firms, including holding companies, being established. 

The transition has helped participating businesses strengthen governance practices, improve transparency and compliance, and enhance financial resilience, enabling them to compete more effectively in local and international markets and attract higher-quality investment.

Mohammed bin Salem Al Hashmi, Director of the Regulatory Establishments Department at MoCIIP, said the incentive programme represents a strategic step towards reinforcing Oman’s business ecosystem. 

He noted that conversion to closed joint-stock status raises standards of governance and regulatory compliance, supports company expansion and financial stability, and contributes to the development of the national capital market, while also improving regulatory efficiency and supporting economic diversification.