[World Tax News] US Remittance Tax | Oman PIT | China Credit

Editorial Team – [2025] 176 taxmann.com 108 (Article)

World Tax News provides a weekly snippet of tax news from around the globe. Here is a glimpse of the tax happening in the world this week:

1. US Senate passes ‘Big Beautiful Bill’; introduced 1% remittance tax on non-citizens

The US Senate passed President Donald Trump’s “One Big Beautiful Bill Act,” a comprehensive 900+ pages legislative package that includes various Republican priorities. This bill, effective July 4, 2025, introduces a 1% tax on overseas money transfers by non-citizens. This levy applies to remittances made via cash, money orders, or cashier’s checks.

The legislation encompasses a wide array of provisions, including:

Tax Changes:

• It permanently extends the income and other tax rates established by the 2017 tax law, preventing their scheduled expiration at the end of 2025, which would have resulted in higher taxes for most Americans.
• New tax deductions are introduced, fulfilling Trump’s 2024 campaign promises. These include:

1. 1. Up to $25,000 for qualified tip income (for workers like restaurant servers, barbers, and drivers).
   2. Up to $12,500 for overtime income for hourly workers.
   3. A $6,000 deduction for seniors.
   4. A deduction for interest on loans for new US-made cars.

• The bill also creates “Trump accounts,” government-funded savings accounts for children, each with a $1,000 initial investment.

Spending and Other Priorities:

• The bill allocates new funding for national defense and deportations.
• Tax credits for electric vehicles and energy efficiency will be terminated this year.
• Clean electricity production tax credits will be gradually reduced, with solar and wind credits phased out more rapidly.
• New requirements mandate that clean power projects progressively reduce their reliance on Chinese-made components, a significant shift for the industry.

Source:

• One Big Beautiful Bill
• Bill Summary

2. Oman Introduces Personal Income Tax Law effective from 2028

On 30 June 2025, Oman promulgated Royal Decree No. 56/2025 in the Official Gazette, enacting the Personal Income Tax Law. As previously announced, Oman will implement a personal income tax regime starting in 2028, levying a 5% tax on individuals’ net income exceeding OMR 42,000.

Key features of the law include:

• Scope of Taxation – Tax will apply to the income of tax residents earned within or outside Oman, and to the income of non-residents earned within Oman.
• Tax Residency – An individual is deemed a tax resident if they stay in Oman for more than 183 days in a tax year.
• Tax Year – The tax year follows the calendar year, ending on 31 December.
• Components of Gross Taxable Income – Includes salaries and wages, income from self-employment, rent/lease income, royalties, interest, dividends, capital gains on disposal of shares, securities, and Sukuk, capital gains on real estate disposals, retirement pensions, end-of-service benefits, prizes and awards, grants and donations, and bonuses linked to board or council membership.
• Computation of Taxable Income – Taxable income is calculated separately for each category, allowing standard deductions. For self-employment and rental/leasing income, a standard deduction of 15% or deduction of actual expenses is permitted.
• Loss Set-Off and Carry Forward – Losses related to certain income types—such as self-employment, rentals, and gains from real estate or share disposals—may be offset against the same source and carried forward for up to five years.
• Foreign Tax Credit – Foreign taxes paid may be credited against the tax liability for the year. However, any excess foreign tax credit cannot be carried forward.
• Return Filing Obligations – Individuals with total income exceeding OMR 42,000 must electronically file a tax return within six months after the tax year’s end. If the income is limited to salaries, wages, bonuses, or pensions from a single employer, the employer is responsible for filing.
• Assessment and Payment of Tax – Tax becomes payable from the assessment date, generally the date of return filing. If no return is submitted, the authority may issue an estimated assessment. Tax is due either on the return filing date or, for amended/estimated assessments, on the date of notification.
• Withholding Obligations for Employers – Employers must withhold and remit tax on employee income, including salaries and pensions. Detailed requirements will be prescribed by regulations.
• Withholding for Non-Employer Payments – Public and private entities in Oman must withhold 20% of tax on income exceeding OMR 20,000. For non-resident recipients, 100% of the tax due must be withheld. Regulations will specify detailed procedures.
• Additional Provisions – Royal Decree No. 56/2025 also addresses matters concerning tax administration, penalties, objections, appeals, and other procedural aspects.

Source – Royal Decree 56/2025

Click Here To Read The Full Article