| Jordan Income Tax Personal income tax in Jordan is levied at progressive rates from 5% to 25%.
Jordan Income Tax Rates for Individuals 2009
Taxable income (JOD) / Tax Rate
Up to 2,000: 5%
2,001 to 6,000: 10%
6,001 to 14,000: 20%
Above 14,000: 25%
Resident and nonresident individuals are taxed only on income sourced in Jordan. An individual present in Jordan for 183 days or more in a calendar year is treated as a resident for tax purposes.
Income tax is payable by resident and non-resident individuals on taxable income. Tax is deducted at source from salary income with the following deductions being available.
- Standard deduction: JOD 1.000/-
- Spouse: 1,000/- (non working only)
- Children: 500/- each
- Dependents: 200/- each not exceeding 1.000/-
- Education: 2,000/- each dependent student
- House rents: 2,000/- maximum
- Mortgage: 2,000/- maximum
- Medical: Subject to certain conditions
- Income: 50% for the first JOD 12,000 (for salaried persons only), 25% for excess of 12,000
There are no deductions for companies.
Tax year: Tax year in Jordan is the calendar year.
Capital Gains Tax: Jordan does not tax capital gains.
Capital Acquisitions tax: There is no Capital Acquisitions tax in Jordan.
Real property tax: Real property tax is levied at 15% of the estimated annual rental value of the property.
Inheritance tax / Estate tax: There is no Inheritance tax / Estate tax in Jordan.
Net wealth / net worth tax: There is no Net wealth / net worth tax in Jordan.
Jordan Corporate Tax RatesJordan corporate tax rate is 25%, but the rate for banks and financial institutions is 35%. A lower 15% tax rate applies to income from certain activities including construction, transport and metallurgy.
Jordan tax law does not define residence for tax purposes, but a company that is registered in Jordan is deemed to be resident for tax duties.
Taxable income: Taxable income is the income derived from Jordan.
Taxation of dividends: Jordan does not tax dividends.
Capital gains tax: Jordan does not tax capital gains.
Securities transaction tax: Securities Transaction Tax (STT) is applicable to transactions of purchase or sale of equity shares, derivatives, units of equity oriented fund through recognized stock exchange or sale of a unit of an equity oriented fund to Mutual Fund.
With effect from 1 January 2002, STT is payable equally by purchaser and seller at 0.05% of transaction value.
Real property tax: Real property tax is levied at 15% of the estimated annual rental value.
Dividend distribution tax: Domestic companies that declare, distribute or pay dividends are not subject to dividend distribution tax.
Branch profits tax: Jordanian branches of foreign companies are taxed in Jordan on income received and/or accrued in Jordan (net of allowable expenses) at the rate applicable to Foreign Companies.
Fringe benefits tax: There is no separate fringe benefits tax. Benefits provided by employers to their employees are generally taxed in the hands of the employees as perquisites, computed in the prescribed manner. Employers are obligated to withhold payable income tax on all benefits provided to employees on their behalf. If the company adapts provident funds or insurance plans, employers are required to contribute.
Tax year: Tax year is the calendar year.
Tax treaties: Jordan has about 20 tax treaties signed.
Jordan Sales Tax / Value Added TaxThe standard sales tax rate in Jordan is 16%, with a higher rate applying to certain luxury items. Exemptions include some basic food stuffs, fertilizers, crops, fruit, seeds, books and newspapers. Jordan levies a sales tax of 16% on supplies of manufacturers, importers and suppliers of services.
Sales tax is levied on the sale of goods, transfer of right to use goods, lease transactions and also transfer of materials in execution of works are considered as deemed sales and are liable to sales tax. In this regard, 'goods' refer to movable property and even include intangible property such as copyright, trademark, patents etc.
The sales tax is levied on interstate as well as intrastate sales. The inter-state sales tax collected by the Central Government is known as central sales tax (CST) and intra-state tax collected by respective state governments is known as local sales tax (LST). Varying rates of sales tax are prescribed on different products. Most of the states levy sales tax at the first point of sales in the state. Consequently, subsequent sale of goods within the state are exempt from tax. The rate of sales tax is either 4% or 16%. State government initiative to promote industrial growth provides sales tax exemption, deferred payment facilities and sales tax set off.
Export sales and trading within a qualified Free Zone are sales tax exempted transactions in Jordan.
Other taxes in JordanCustoms Duty: Customs duty is payable on goods imported into Jordan. The rates of basic customs duty may reach up to 300% depending on the governmental strategy.
Research and Development Tax: Publicly traded corporations are required to withhold 1% of annual income to be used for research and development purposes in Jordan.
Wealth Tax: Wealth tax is not applicable in Jordan.
Gift Tax: Gift Tax is levied on certain gifts such as lottery prizes and other similar winnings. The rate is 10% plus 1% service charge if such income exceeds JOD 1,000.
Service Tax: Service tax is levied at 10% of the yearly income tax on individuals.
Minimum alternate tax (MAT): Minimum alternate tax (MAT) is not applied yet in Jordan.
| 
