• 1. Freight tax

Freight tax

Freight tax: 3.25% of the gross outward freight earnings derived from international transport activities of non-residential shipowners and/or operators. This rate consists of income tax of 2.5%  and a distribution tax of 0.75%.


Exemption Agreements
Double taxation agreements, based on residency of the freight recipient (unless otherwise noted), have been concluded with the following countries, which may reduce or waive the freight tax.  

Country Reduction Date of entry
into force
Date of effect
Algeria
100%   01/01/2001
Bahrain 100%   01/01/2002
 Bulgaria 100% 14/02/2008 01/01/2009   
Canada 1
100% 24/12/2000 01/01/2001
Croatia 2, 3 100% 17/02/2006 01/01/2007
Czech Republic 100%   01/01/2008
Egypt
100%   01/01/1997
France 2
100%   01/01/1985
Indonesia 1 100%   01/01/1998
India 4 See Note 16/10/1999 01/01/2000
Iran 100%   01/01/2009
Korea, Republic of 1
100% 28/03/2005 01/01/2006
Kuwait 100%   01/01/2002
Lebanon 100%   01/01/2003
Malta 1 100% 13/10/2010 01/01/2011
Malaysia 1 100%   01/01/2001
Netherlands 100% 01/01/2008
Pakistan 2, 6 50%   01/01/2006
Poland 2, 5, 6
100% 22/04/1999 01/01/2000
Qatar 100% 31/12/2008 01/01/2009
Romania 100%   01/01/1984
Syria 100%   01/01/2002
Tunisia
100%   01/01/1990
Turkey
100%   01/01/1987
Ukraine 100% 23/10/2008 01/01/2009
 United Arab Emirates 100% 10/01/2017 01/01/2018   
United Kingdom 1
100% 24/03/2002 01/01/2003
Yemen 100%   01/01/2000
       
Limited Treaties (Air and/or Sea)
Denmark (Air and Sea)
100%    
Greece (Sea only) 100%    
Spain (Air only) 0%    
United States (Air and Sea)
100%    
       
       
Comprehensive treaty negotiation currently in progress
       
Signed but not ratified   Date signed  
Morocco   16/05/2005  
       
Concluded but not signed
Italy 2, 3
100%    
Serbia 100%    
Sudan      
       
In the process of negotiation
Belarus      
Libya      
Moldova      
Saudi Arabia      
   
Exemption based on reciprocity
Non-resident shipowners are not subject to income tax on income derived from the shipping of passengers, animals, mail or goods from Jordanian ports if the law of their country offers a reciprocal treatment to Jordanian shipowners.
       
Notes:      
         
1. These treaties provide that profits derived by an enterprise of a Contracting State from the operation of ships or aircraft in international traffic shall be taxable only in that State.
   
2. The treaties provide that profits from the operation of ships in international traffic shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated.
   
3. The treaties provide that if the place of effective management of a shipping enterprise is aboard a ship, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship is situated, or, if there is no such home harbour, in the Contracting State of which the operator of the ship is a resident.
   
4. Income derived from the operation of ships between India and Jordan: 100% exemption. All other cases the tax imposed shall be reduced by 50%.
   
5. The treaty provides that profits from the operation of boats engaged in inland waterways transport shall be taxable only in the Contracting State in which the place of effective management of the enterprise is situated .
   
6. The treaties provide that if the place of effective management of a shipping enterprise or of an inland waterways transport enterprise is aboard a ship or boat, then it shall be deemed to be situated in the Contracting State in which the home harbour of the ship or boat is situated, or if there is no such home harbour, in the Contracting State of which the operator of the ship or boat is a resident..
 
Remarks

Presently there is no freight tax levied on bulk fertiliser shipments such as Phosphates, DAP and Potash when local shippers act as charters for their CFR sales.

   
  

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