MUSCAT, OCT 18
Oman has identified a broad range of industrial, technological, energy and other activities of special economic significance as eligible for income tax exemptions under new executive regulations governing its special economic zones and free zones, reinforcing efforts to attract high-value investment and accelerate economic diversification.
The provisions, outlined in Chapter Seven of the Executive Regulation of the Law of Special Economic Zones and Free Zones, issued under Decision 81/2026, seek to strengthen the Sultanate of Oman's attractiveness to high-value investors while advancing industrial diversification, technological development and economic security.
Under Article 37, enterprises involving investments of at least RO 10 million may qualify for strategic status and a single approval covering their establishment, operation and management.
Eligible projects must contribute to technology and knowledge transfer, strengthen local content, enhance self-sufficiency or economic security, or increase Oman's annual exports. They must also fall within investment fields identified by the Board of Directors of the Public Authority for Special Economic Zones and Free Zones (OPAZ), in line with national development strategies.
Importantly, the Board may waive the RO 10 million minimum investment requirement where a project's nature or strategic importance warrants special consideration.
Article 39 provides for additional incentives, subject to approval by the Council of Ministers on the Board's recommendation. These include exemptions from land and property rentals or usufruct payments for up to 10 years from commencement of operations, exceptions from prescribed Omanisation percentages for up to four years, and full or partial exemptions from applicable fees.
Other project-specific incentives may also be approved.
A significant component of Chapter Seven concerns income tax exemptions for activities classified as being of a special nature under Article 41.
These encompass heavy manufacturing, including petrochemicals, minerals and basic metals; renewable energy and green industries; green hydrogen and its derivatives; port logistics and cargo handling; advanced technologies, data centres, artificial intelligence and innovation; strategic infrastructure; food security; pharmaceuticals, medical industries, biotechnology and recycling.
The eligible categories additionally cover administrative offices, commercial representation, import-export businesses and related activities generating national economic value. Service providers may also qualify, provided their contracts have at least 15 months remaining when exemption applications are submitted.
The Board retains discretion to include other projects demonstrating economic or strategic value to the zones or the national economy.
Beyond tax incentives, the regulations permit enterprises to export products directly or through third parties without requiring separate export permission or licensing, subject to reporting requirements.
Foreign investors and eligible real estate owners are also provided a framework for obtaining residency, extending to spouses and first-degree relatives, subject to stipulated conditions.
The wider regulations introduce measures designed to improve the investment environment, including integrated electronic one-stop-shop services, streamlined licensing, clearer compliance obligations and dedicated provisions governing real estate development.
Notably, complete licence applications must be decided within seven working days, with non-response treated as approval.
Collectively, the framework strengthens Oman's efforts to attract strategic capital into manufacturing, clean energy, logistics and technology, while positioning its economic zones as competitive destinations for long-term investment.
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