Kuwaiti Cabinet approves 15% tax on multinational entities with new bill

On Tuesday, the Kuwaiti Cabinet approved a new law that will impose a 15% tax on multinational companies. These are companies that operate in more than one country or state. This decision was made during the Cabinet's weekly meeting at Bayan Palace, chaired by His Highness the Prime Minister, Sheikh Ahmad Abdullah Al-Ahmad Al-Sabah.

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The new law is designed to help reduce tax evasion, which occurs when businesses avoid paying taxes that they owe. By applying this tax, the government aims to prevent companies from sending tax revenues to other countries, where they may avoid paying taxes. This law will ensure that multinational businesses pay their fair share of taxes in Kuwait.

The 15% tax is in line with international tax standards, meaning it follows the global rules for taxing multinational companies. These standards are set to make sure companies do not escape paying taxes by shifting their profits to countries with lower taxes. Kuwait’s decision to implement this tax is part of its efforts to follow these international standards and contribute to the global fight against tax evasion.

According to Deputy Prime Minister and Minister of State for Cabinet Affairs, Shereeda Al-Mousherji, this law will be effective on January 1, 2025. From that date, any multinational company operating in Kuwait will have to pay the new 15% tax on their earnings.
The introduction of this law reflects Kuwait’s commitment to improving its tax system and making sure that businesses contribute fairly to the country's economy. It is also part of Kuwait's broader effort to modernize its tax policies and align them with global practices.