Iraq's Council of Ministers has approved the income and capital tax treaty with Oman, advancing the agreement signed in September 2025 to eliminate double taxation and prevent fiscal evasion. The treaty will take effect after ratification procedures are completed.
Iraq’s Council of Ministers approved the income and capital tax treaty with Oman on 25 May 2026.
Iraq and Oman signed the income and capital tax treaty on 3 September 2025. The agreement aims to eliminate double taxation and prevent fiscal evasion.
The treaty applies to Iraqi income tax, real estate tax, vacant land tax, and the tax on the income of oil companies contracted under Iraqi Law No. 19 of 2010. On the Omani side, it applies to income tax.
Under the treaty, the withholding tax rate on dividends is 5% where the beneficial owner is a company that has directly owned at least 10% of the paying company’s capital for a period of at least 365 days ending on the date the dividends are paid; otherwise, the rate is 10%. The withholding tax rate on Interest is 10%, while Royalties are also subject to a 10% withholding tax rate.
The treaty will enter into force following the exchange of ratification instruments and will take effect from 1 January of the year after its entry into force.
