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New system in #Jordan exempts exported international arbitration services from taxes.
New system in Jordan exempts exported
international arbitration services from taxes
* By: Dr. Bassam Talhouni
In a bid to encourage arbitration services in Jordan to ensure that the Kingdome becomes a
center for arbitration in the area, the Jordanian government decided to completely exempt
the entire or partial international arbitration services in Jordan from income tax.
The exemption will include arbitrators, lawyers and experts` fees. To implement the
exemption, the new system stipulated that at least one of the arbitration process members
be foreign similar to the nationality of one of the arbitrarily parties or one of his/her lawyers
or the Disputes Obligatory Law.
It is worth mentioning that there was an amendment to Article (40 of the Commercial and
Services Exports Profit Exemption System from the Tax Income Number (106) for the year
2016 that used to totally exempt the net product services provided in Jordan from the income
tax if it was exported, including legal, engineering, auditing and accounting consultancies
services among other services. A new section was introduced to Article (4) under Paragraph
(13) to exempt international arbitration services.
The Jordanian government had aimed to encourage services providers that are specified in
the system when it decided to issue the mentioned system as well as to benefit from the
qualified and distinguished human resources, and the reasonable and relatively competitive
average pay to provide the mentioned services to nearby Arab countries by relying on Jordan`s
It is also worth mentioning that the Jordanian government has recently through the Ministry
of Justice, conducted serval amendments to the Jordanian arbitration Law (JAL) to include
additional privileges that encourages resorting to arbitration as a mean to resolve disputes, in
addition to stipulating the establishment of an arbitration center in the Aqaba Special
Economic Zone that already provides tax and economic privileges that is making it a point of
economic and trade attraction in the area. The (JAL) also stipulated the establishment of
another arbitration center in the capital, Amman.
For more information, you can contact our law firm (Al Talhouni & Odat Lawyers) at:
* Former Justice Minister and Member in the Jordan`s Senate.