Bahrain has announced it will introduce a new Domestic Minimum Top-up Tax (DMTT) for multinational enterprises (MNEs) which will come into effect from January 1, 2025.
The tax will apply to corporations with global revenues exceeding €750 million ($828.6 million) in at least two of the last four fiscal years and it will amount to a minimum of 15% of the company’s profit generated in the Kingdom, the Bahrain News Agency has reported.
Eligible businesses will need to register with the National Bureau for Revenue, which also manages VAT and excise taxes.
The new tax is in line with the Organisation for Economic Co-operation and Development (OECD) guidelines, aimed at promoting global economic fairness and competition. To date, 140 jurisdictions have committed to this reform programme, introduced in October 2021. The UAE introduced its first federal corporate tax in June 2023.
The global minimum tax is expected to generate around $220 billion annually, accounting for approximately 9% of global corporate income tax revenue, according to the OECD..
The International Monetary Fund (IMF) has projected that Bahrain’s real GDP will grow by 3.6% in 2024.
