OMAN LAW AND PRACTICE Contributed by: Said Al-Shahry, Thamer Al-Shahry, Jeremy Pooley, Maria Mariam Rabeaa Petrou, Shadha Al Kharusi and Salim Al Harthi, Said Al Shahry & Partners (SASLO )
• grant the employees whose contracts will be terminated a notice period of no less than three months; and • give the employees whose contracts will be terminated priority to be reappointed if there is a job opportunity that matches their qualifi - cations. 4.5 Employee Representations The Labour Law does not expressly include pro - visions relating to employee representations. 5. Tax Law 5.1 Taxes Applicable to Employees/ Employers Personal Income Tax Although Omani citizens and residents are not currently subject to personal income tax unless they solely own an establishment (as defined in 5.2 Taxes Applicable to Businesses ), an income tax on high earners/high-net-worth individuals is expected to be implemented in 2026. Social Insurance The following taxes apply. • Insurance for old age, disability and death – Omani employees must contribute 7.5% of their gross salary to the Social Protection Insurance (SPI). The employer is also required to contribute an amount equal to 11% of the gross salary of an Omani employee. The gross salary is capped at OMR3,000 per month for the purpose of calculating these contributions. • Insurance for work injuries and occupational diseases – the employer is required to con - tribute an amount equal to 1% of the gross salary of an Omani employee. The gross sal -
ary is capped at OMR3,000 per month for the purpose of calculating these contributions. • Insurance for employment security – Omani employees must contribute 0.5% of their gross salary to the SPI. The employer is also required to contribute an amount equal to 0.5% of the gross salary of an Omani employ - ee. There is no cap for calculating these contributions. • Insurance for maternity/paternity leave – the employer is required to contribute an amount equal to 1% of the gross salary of all employ - ees (Omani and expatriates). The gross salary is capped at OMR3,000 per month for the purpose of calculating these contributions. • Insurance for sick/extraordinary leave – with effect from July 2025, the employer is required to contribute an amount equal to 1% of the gross salary of an Omani employee. The gross salary is capped at OMR3,000 per month for the purpose of calculating these contributions. Contributions for the three types of insurance referred to above are deducted from the employ - ee’s salary on a monthly basis and remitted by the employer to the SPI. 5.2 Taxes Applicable to Businesses Income Tax The following categories of persons (Omani tax - payers) are liable to income tax in Oman: • enterprises; • establishments; and • permanent establishments. The tax rate is generally 15% of taxable income, although a lower rate of 3% applies to certain small taxpayers where prescribed conditions are met.
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