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With assistance from Abu Timam Grant Thornton, this chapter provides an outline of the new tax regulations issued at the start of 2012, as well as rules for the establishment of foreign companies in Oman. Information is provided about tax rates, filing requirements, deductable expenses and more. The chapter also includes a viewpoint with Nasser Said Al Mughairy, Managing Partner at Abu Timam Grant Thornton.

While a significant portion of economic activity in Oman is concentrated in the capital and nearby surrounding areas, a number of other regions remain key drivers of economic growth. Moreover, these regions are playing an increasingly important role as the national economy matures and diversifies. For example, Sohar offers shipping firms a seaport south of the Strait of Hormuz, which reduces operational costs incurred by heavy congestion through the channel. Indeed, shipping at the Port of Sohar has increased substantially in recent years, with dry bulk growing by over 400% and liquid bulk by 65%. The Port of Salalah is another key transport hub for the region, the attractiveness of which to investors has grown markedly with the establishment of the Salalah Free Zone (SFZ). In Duqm - Oman’s third emerging economic hub - the bulk of economic activity in Duqm focuses on the industry and transport sectors, both of which are expanding rapidly. This chapter includes interviews with Yahya bin Said Al Jabri, Chairman, Special Economic Zone Authority at Duqm (SEZAD); and Said bin Hamdoon Al Harthi, Undersecretary for Ports & Maritime Affairs at the Ministry of Transport & Communications.

The tourism sector is enjoying increased attention. In 2012 it accounted for some 3% of GDP, saw growth of nearly 4% in the same year, and contributed to the creation of some 70,000 jobs in 2011. In the broader Middle East region, tourism job creation actually shrank by 0.6%. Going forward, the government’s priority is to diversify tourism offerings, via a number of initiatives to promote the camping and adventure segment. Furthermore, as part of efforts to build up new segments, the authorities are attempting to promote the sultanate as a golfing destination to both domestic and foreign golf enthusiasts. Sailing academies are also being expanded in an effo

The creation of a public education system capable of equipping Omanis for a modern economy has been at the centre of government policy for decades, and the private sector has thrived since the 1970s. Yet, more recently, the sector has seen a similar expansion of investment at the tertiary level, combined with an increasing amount of research activity. This new phase of expansion is underpinned by the latest five-year plan, which outlines a 48% increase over the previous plan in terms of sector spending, for the development of some 15 new schools, 32 expansion projects and 65 extensions to meet the growth of student numbers by 2015. Private schools, meanwhile, have continued to benefit from the presence of an expatriate community, which grew 32% between 2003 and 2010, and is expected to continue increasing. In health, meanwhile, growing investment in the sector has resulted in improving health indicators, and the government is working to encourage the public to participate in health care provision. This chapter includes an interview with Rawya Saud Al Busaidi, Minister of Higher Education.

After many years of building up the transport system – and with over $11bn in the budget for hard infrastructure projects during the 2011-2015 period – the next few years promise significant transformation for Oman’s transport sector. A number of large-scale developments are in the pipeline, and a proposed new railway connecting Oman with other GCC countries is expected to create capacity for 8800 tonnes of freight daily. The authorities are also diversifying port infrastructure to ensure each sector of the economy can benefit more fully. In addition, Muscat International Airport is gearing up for major capacity upgrades to cope with the 18% year-on-year increase in arrivals between August 2011 and August 2012. These are, therefore, highly exciting times for the sector, with major developments across the board creating opportunities not just for construction contractors, but also for logistics companies of all kinds. This chapter includes an interview with Ahmed bin Mohammed bin Salim Al Futaisi, Minister of Transport and Communications.

Over the past 40 years, Oman’s telecoms market has transformed from a state monopoly to a multi-player market, one that has been marked by an increasingly fast pace of development. As more players have entered the market, fierce competition among operators has helped keep prices down. The sector has enjoyed good growth in recent years; mobile subscribers almost tripled between 2005 and the second quarter of 2012, increasing 274% from 1.33m to 4.98m. Looking ahead, the market has several strengths, including an evolving regulatory framework, multiple competitive players and a steadily growing customer base. The market, however, could hit some stumbling blocks as it matures. Regulation has come quite far in the past few years, but communication among state entities, private operators and consumers is set to be crucial to ensure that legislation continues to accommodate growth. This chapter includes an interview with Salim Sultan Al Ruzaiqi, CEO, Information Technology Authority (ITA).