Oman Adds Tax-Exempt REITs To Offering

by Lorys Charalambous, Tax-News.com, Cyprus

06 March 2018

Oman's Capital Market Authority, which regulates the sultanate's financial markets, has issued a decree providing an exemption for newly permitted real estate investment funds.

The new collective investment scheme, known in other jurisdictions as a real estate investment trust or REIT, is tax exempt and units in the fund can be traded on the Muscat Securities Market.

To be a qualifying fund it must have a minimum capital of OMR10m (USD26m), distribute not less than 90 percent of annual profits to unitholders, invest 75 percent of its capital within Oman, and invest in existing income-generating properties and not vacant land.

Funds may take the form of an investment fund or financial trust and can borrow directly by issuing conventional bonds or Sukuk (Islamic bonds) up to 60 percent of total assets. Foreign investment of up to 100 percent is permissible but 40 percent of a fund's capital must first be offered to the public.

Announcing the new fund, Abdullah Salim Al Salmi, Executive President of the Authority, said it was hoped the new fund offering would attract more foreign investment in Oman's real estate sector.

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