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Qatar Adopts Global Minimum Tax Provisions and Other Tax Law Changes — Orbitax Tax News & Alerts

On 2 February 2023, Qatar published Law No. 11 of 2022 in the Official Gazette, introducing several changes to the Income Tax Law (Law No. 24 of 2018). Some of the main changes include:

  • New provisions for a minimum effective tax rate of 15% through a qualified domestic minimum top-up tax (QDMTT) for in-scope entities based on the Pillar 2 global minimum tax (GloBE) rules;
  • New provisions for the taxation of certain income arising from sources outside Qatar, including income from immovable property, dividends, royalties, interest, technical service fees, and other services as long as such income is not attributable to a foreign permanent establishment;
  • New foreign tax credit provisions to provide a credit for foreign tax paid on the foreign source income that has become taxable in Qatar, subject to certain conditions;
  • New reporting requirements in relation to substance and core activities, along with a rule that a Qatar tax residency certificate will not be issued to entities not meeting substantial activity requirements, as well as a penalty equal to 15% of net income where the requirements are not met; and
  • New ultimate beneficial owner (UBO) requirements, including that companies, partnerships, foundations, etc. must maintain accurate information on their UBOs and intermediaries, with such information to be submitted when required.

Law No. 11 of 2022 is generally effective from the date it was published, 2 February 2023, with the application of the changes to be regulated through amendments to the relevant executive regulations. Further details will be published once available.