Qatar: What you need to know about the country
Qatar combines a conservative legal system with progressive economic reforms. Low taxes, no VAT and developed infrastructure make it attractive for business. However, competition with the UAE and Saudi Arabia requires a clear strategy. Successful projects most often focus on energy, digitalization and events.
Legal system
Sources of law
- Sharia.
- Islamic banking is a prime example of the application of Shariah norms in the financial sector.
- It is governed by principles that prohibit riba (interest-bearing lending), promote fair risk sharing and ensure ethical standards are followed.
- International treaties (if they do not contradict Sharia).
- Constitution.
- Laws are the main instruments of legislation and regulate a wide range of issues, including economics, trade and public relations.
- The Civil Code as part of the legislative framework and civil legal system.
- Decisions of ministries play the role of by-laws on narrower and more specialized issues.
Reforms for business
- Labor Code (2020): abolition of the kafala system (permission to change employer without the consent of the sponsor).
- Qatar Free Zone and Company Law: For most types of activities, founders are allowed 100% foreign ownership of the business, however, there are exceptions: banking or insurance.
- Intellectual property: participation in the international system of intellectual property protection.
Trends
Sports, event management, tourism
After the 2022 World Cup, Qatar has a large amount of state-of-the-art sports and tourism infrastructure that the government and business can use to their advantage and develop new projects on their basis.
- Qatar to host Formula 1 Grand Prix after 2022 World Cup
- 2025 World Athletics Championships.
- Acquisition of Paris Saint-Germain, creation of beIN Sports.
- More than 2 million tourists in 2023 (40% increase after the 2022 World Cup).
Digitalization
- National AI Strategy: Qatar aims to introduce smart systems in transport and logistics.
- 5G coverage – 99% of the territory (partnership with Ericsson).
- QIA actively invests in technology and startups.
- Qatar Science & Technology Park (QSTP) and Doha Tech Angels accelerators.
Taxes
VAT
There is no VAT in Qatar. However, Qatar has been a member of the VAT Agreement of GCC states since 2023. The Qatari government is considering introducing it in the future, the expected rate is 5%.
Income tax
Foreign companies are required to pay income tax at a rate of 10% if their activities are present in Qatar (for example, through an office, branch or agent). Companies operating remotely or through intermediaries are also subject to taxation, are not subject to tax.
Withholding Tax (WHT)
This is a mandatory withholding of a portion of the amount of income from a source in Qatar that a resident of Qatar pays to a non-resident.
The tax rate depends on the taxable transaction and the place of registration of the company. On the Mainland, the rate is 5%.
Personal Income Tax
There is no personal income tax in Qatar for either citizens or foreign residents. However, it is worth considering that the income of an individual who conducts business in Qatar may be subject to income tax if that person receives income from sources in Qatar.
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