As Oil Profits Plunge, Gulf Regimes Weigh the Unmentionable: Taxes

Dubai’s year-round sunshine and near-zero taxes have been easy sells for foreign investors and expatriate workers. Oil’s plummet below $30 a barrel might change that for the glitzy emirate and its Arab Gulf neighbors. Gulf states have spent hundreds of billions of their petrodollars in recent decades building economies virtually from scratch. Lacking enough people and know-how to achieve their ambitions, they have relied on millions of foreign workers lured by, among other things, minimal taxation—and in the case of Dubai, no income tax at all. Now, with the plunge in crude prices, governments from Riyadh to Muscat are reassessing their light-touch tax regimes as they search for fresh sources of income to pay for trophy projects and meet the demands of burgeoning youthful populations for better housing, hospitals and schools. After toying with the idea […]

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