Economic expert Sultan Al-Jazzaf commended the tax policy as a transformative step for Kuwait’s economy. Targeting multinational companies earning over €750 million annually, the tax aims to spread the financial burden equitably across sectors.

Addressing Budget Deficits and Promoting Fair Contributions

Al-Jazzaf highlighted that the private sector, which has operated tax-free for decades, will now play a more active role in supporting the national economy. The tax is expected to reduce Kuwait’s budget deficit, projected to persist for the next four years, by diversifying revenue streams and ensuring sustainable economic growth.

Key Provisions and Implementation of the Tax Law

Ensuring Transparency and Fairness

The 15% tax law includes provisions to maintain fairness and transparency. Article 4 exempts government bodies and non-profits, while Article 27 provides mechanisms for companies to contest wrongful assessments.

Enforcing Compliance

The law features strict enforcement measures, such as asset seizure for non-compliant companies, ensuring accountability and preventing tax evasion. Administrative expert Khaled Mohammed described the tax as a pioneering step that strengthens Kuwait’s financial framework.

Potential Price Hikes in Local Markets

Mishaal Al-Manea, Chairman of the Kuwaiti Society for Consumer Protection, supported the tax but cautioned about potential cost increases in local markets. Businesses reliant on international suppliers may face higher costs, potentially affecting consumer purchasing power.

Mitigating Negative Effects

To counteract potential price hikes, Al-Manea advised local businesses to strengthen collaborations with national suppliers and renegotiate supplier contracts. Enhancing administrative efficiency within cooperative societies can further stabilize market prices.

The introduction of taxes on multinational companies is expected to boost Kuwait’s state revenues, ensuring economic justice and transparency. However, experts stress that the success of this policy depends on effective management, close monitoring, and cooperation between government authorities, businesses, and cooperative societies.