Oman to impose fines up to RO 20,000, jail time for income tax defaulters

Dubai: As Oman prepares to implement the Gulf’s first personal income tax in January 2028, authorities have outlined strict enforcement measures, including fines reaching up to RO 20,000 and prison terms for violators.

The law, which applies to individuals earning over RO 42,000 annually, the top 1 per cent of earners in the country, features a two-tiered penalty system for non-compliance, designed to ensure transparency and deter tax evasion.

Under Article 65, individuals who fail to file their tax returns, disregard official notices from tax authorities, or delay payment without valid justification face administrative fines ranging from RO 1,000 to RO 5,000.

For more serious infractions, Article 66 provides for criminal penalties. Those found guilty of submitting false declarations, concealing income, or falsifying tax records could face prison sentences ranging from one to three years and fines between RO 10,000 and RO 20,000.

The legislation, announced in June 2025, represents a critical component of Oman’s fiscal reform agenda and its Vision 2040 plan, aimed at reducing reliance on oil revenues and strengthening state finances.

Minister of Economy Said bin Mohammed Al Saqri has previously emphasised the country’s vulnerability to global oil price volatility, noting that oil and gas still account for up to 85 per cent of public income.

Tax experts say the inclusion of criminal penalties for non-filers signals the government’s intent to implement the new system with a high degree of seriousness and compliance oversight.

The law gives Omani tax authorities broad powers to investigate discrepancies and enforce penalties, setting a precedent in a region historically known for tax-free personal income policies.