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Taxation in Jordan
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Taxation in Jordan

A new income tax law went into effect in 2002 that reduced the top income tax rate to 25% from 30%. The new law also equalised the level of tax exempt income for men and women, at JD1,000 (about $1,418) for both sexes. Income tax rates range from 5% to 25%, with the average tax payer paying a marginal rate of 5%. Corporations are taxed at a rate of 15% (35% for those involved in banking and finance).

In January 2001 Jordan entered the second phase of its transformation to a value-added tax (VAT) regime, a reform begun in 1996. The VAT rate is 13%, and in 2001 about 25 new commodities were added to its coverage, including some food products, tobacco, coffee, soft drinks, new cars, heavy-duty vehicles and paper products. Businesses with sales less than JD250,000 (about $355,000) a year are exempt from registering for the VAT. There are no capital gains or net worth taxes on individuals, and social security taxes are paid jointly by employers and employees.

There is no obligation to produce accounting information. Nevertheless, the information published must be clear, easily understandable and reliable. Only the banking sector is subjected to some obligations.

The "Jordanian Commercial Law" obliges any company to hold an account book, a stock account as well as a business correspondence register. These documents must be kept on the Jordan Territory and drafted in English or Arabic.





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