Kuwait introduces ‘Multinational Corporation Tax’ to boost economic growth and sustainability
Minister Noura Al-Fassam highlighted Kuwait's shift towards economic diversity and competitiveness, driven by legislation that enhances the business environment and attracts investments.
-
The multinational entity tax is a key step towards building a strong and sustainable economy.
-
The multinational tax is a major gateway for Kuwait in building a competitive and flexible national economy.
-
It enhances the quality of legislation and laws related to the business environment.
In alignment with Kuwait Vision 2035, which aims to diversify the economy and reduce reliance on a single income source, the Minister of Finance and Minister of State for Economic Affairs and Investment, Eng. Noura Sulaiman Al-Fassam, announced the implementation of a new tax on multinational entities (MNES).
Issued under Decree No. (157) of 2024 on December 30, 2024, the law introduces a supplementary local minimum tax (DMTT) on multinational entities (MNES) operating across multiple countries or jurisdictions. This initiative aligns with the requirements of the Organization for Economic Cooperation and Development’s (OECD) second pillar framework.
The law aims to ensure that multinational entities pay a minimum tax rate of 15% on taxable income generated in Kuwait. It will apply to multinational companies starting January 1, 2025.
Furthermore, Al-Fassam stated that, implementing this tax underscores Kuwait’s commitment to achieving economic development and financial sustainability. It reflects the country’s dedication to promoting fairness and equality in international taxation, diversifying income sources, reducing reliance on oil revenues, and building a resilient economy capable of addressing future challenges sustainably.
Al-Fassam also mentioned that, Kuwait’s economy is entering a new phase of diversity and competitiveness, driven by government legislation designed to enhance the business environment, attract investments, and create job opportunities.
It is noteworthy that, the Ministry of Finance will notify all relevant companies about the tax implementation and plans to conduct educational workshops and targeted meetings as part of a scheduled timeline to engage with all affected entities.
Additionally, the Ministry is preparing to issue an executive regulation for the law in the near future to streamline the implementation process in the next phase.
Source: Al Rai
