Tue, 17 Mar 2015 09:08:30 AST
Saudi Gazette | KUWAIT CITY — Kuwait has sought help from the International Mo netary Fund (IMF) to introduce corporate taxes in a bid to diversify revenue in the face of falling oil prices, a minister said on Monday.
"The IMF will prepare a preliminary report on how to impose taxes on companies in Kuwait," Commerce and Industry Minister Abdulmohsen Al-Mudej said after a meeting with IMF representatives, the KUNA news agency reported.
The two sides discussed ways of introducing corporate taxes for Kuwaiti and foreign companies after the recent introduction of a new corporate law, the minister said.
Kuwait currently imposes no taxes on local companies, Kuwaiti citizens and expatriates but it requires foreign firms to pay 15 percent tax on their profits.
The IMF has in the past advised Kuwait to subject local companies to corporate tax as part of a series of measures aimed at boosting non-oil revenues and cutting spending.
Kuwait has posted a budget surplus in each of the past 15 fiscal years due to high oil prices but has also increased public spending from under $13 billion (12.4 billion euros) to more than $77 billion this fiscal year, mostly on wages and subsidies.
Earlier this year, the emirate stopped diesel, kerosene and aviation fuel subsidies and the Finance Ministry is considering similar measures for petrol, electricity and water.
Oil income contributed around 94 percent of Kuwait's public revenues but the sharp drop in prices is expected to substantially reduce its income. — AFP
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