Kuwait
A wealthy market with a strict tax administration — the 15 % profit tax falls on foreign owners only, and the customer withholds 5 % of every invoice
Kuwait is a high-income market that imports almost everything, and the most paperwork-heavy state in the Gulf. Two things matter before the first invoice. First: the 15 % profit tax attaches to foreign ownership — a company owned by Kuwaitis or GCC nationals does not pay it. Second: the customer is required to retain 5 % of every payment to a foreign supplier and releases it only against a tax clearance. It is not an extra tax, it is a retention — but it is five per cent of cash flow tied up for months. There is no VAT.
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Setting up a company
Setting up a company and tax are the part of the profile you cannot assemble elsewhere in an afternoon. The rest of the page is open.
- ·Legal forms
- ·Foreign ownership
Taxes
Setting up a company and tax are the part of the profile you cannot assemble elsewhere in an afternoon. The rest of the page is open.
- ·Corporate income tax
- ·VAT
Visas and residence
Setting up a company and tax are the part of the profile you cannot assemble elsewhere in an afternoon. The rest of the page is open.
- ·Short stay
- ·Work permit
Investment opportunities
Setting up a company and tax are the part of the profile you cannot assemble elsewhere in an afternoon. The rest of the page is open.
- ·Rules for a foreign investor
What it makes and needs
Oil and petrochemicals, construction and infrastructure, healthcare, food, consumer goods. Kuwait imports essentially all of its consumption apart from fuel, and it is a market where suppliers are chosen through a local agent — commercial agency there is not a formality, it is how buying is done.
Money and payments
The Kuwaiti dinar (KWD) — the world's strongest currency in nominal terms, pegged to a basket. There are no exchange controls.
Importing into their market
The Gulf Cooperation Council's common tariff: 5 % of CIF value on most goods, with exceptions — some food and medicines are at zero, while tobacco and alcohol carry excise duties an order of magnitude higher. Duty is paid once on entry into the customs union and the goods then move between member states without further duty.
Toys and low-voltage electrical appliances may be sold in the Gulf only with the G mark (Gulf Conformity Mark) under GSO technical regulations. Since 1 April 2017 it is shown as the GCTS tracking symbol: the G mark with a QR code. It is mandatory in the UAE, Saudi Arabia, Bahrain, Qatar, Kuwait, Oman and Yemen, and is issued by a GSO notified body.
Prepackaged food is labelled under GSO 9/2013: the information must be in Arabic, and another language may appear only alongside it with identical content. Halal food follows GSO 2055-1:2015 across the whole chain from receipt to storage; GSO published a draft of its new version on 17 February 2026.
THE FIVE PER CENT RETENTION. A Kuwaiti customer is required by law to retain 5 % of every payment to a foreign supplier and releases it only against a tax authority clearance confirming the supplier has no arrears. It can be resolved — by filing a return and obtaining the certificate — but it takes months, and without a contract term it means five per cent of the price tied up indefinitely. Contracts set out who deals with the retention and by when.
Outlook
What to watch: whether and when Kuwait introduces VAT, a decision years in the making; the progress of projects under the New Kuwait vision, which is the main source of public procurement; and whether the sponsorship regime loosens — it is the largest obstacle to staffing positions with foreign specialists.
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