Cross-border Tax Talks Pillar Two: Middle East Roundup
Dec 22, 2025
Hanan Abboud, a Dubai-based tax expert leading PwC's Pillar Two initiatives in the Middle East, shares insights on the intricate corporate tax landscape across the GCC. She discusses the unique aspects of Zakat in Saudi Arabia and Kuwait, along with the prevalence of withholding taxes and treaty networks. Hanan explains the intricacies of Bahrain's upcoming QDMTT and contrasts it with Oman and Qatar's approaches. She emphasizes the compliance challenges posed by data collection and urges Middle Eastern firms to start addressing Pillar Two requirements promptly.
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Bahrain's QDMTT And Authority Capacity
- Bahrain introduced a QDMTT for 2025 despite historically having no corporate tax, marking its first direct tax.
- Tax authorities across the region are hiring and upskilling to manage new corporate tax and Pillar Two workloads.
Kuwait's DMTT Creates Legal Uncertainty
- Kuwait's QDMTT text suggests entities subject to DMTT would no longer face corporate tax or Zakat, creating market confusion.
- Existing Kuwaiti rules (shareholder tax and PE-like provisions) complicate interaction with the new DMTT.
Oman's IIR Is Brief And Unclear
- Oman surprised the market by issuing an IIR for 2025, but its guidance is currently brief and unclear.
- Markets expect further rules such as a DMTT may be added later.