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A new law that would result in foreign oil and companies working in Iraq paying 35% income tax to the Gulf state has had its first reading in parliament.
Reuters reported that the tax would encompass oil and gas contracts across the whole spectrum including exploration, production and processing.
“Today we held a first reading of a draft to impose tax on foreign oil companies working in Iraq,” Haider al-Ebadi, head of parliament’s economic committee is quoted by Reuters as saying.
The law will bring in significant revenues for the Iraqi government and will enable them to invest in the country’s crumbling oil and gas infrastructure.
Before the bill becomes law it will require a second reading before being put to a vote. However, it is believed that there will be little or no opposition to the move and it will pass through parliamentary protocol quickly.
“The law will give Iraq major, significant revenue. I don’t expect anyone to resist this law,” Amera al-Baldawi, a Shi’ite Arab lawmaker who sits on the economic committee is quoted by Reuters as saying. .
The full details of the law have not yet been disclosed by Baghdad.
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