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Tax rates in Jordan

Tax Rates

Consumption Taxes

Nature of the Tax
 General Sales Tax (GST) - It applies to locally manufactured products as well as imported ones.
Tax Rate
Reduced Tax Rate
Several items are exempt: wheat, bread, electrical energy, firefighting vehicles, education, medical services.
A zero rate applies to the export sales of goods and services, the free zone areas and markets, the Aqaba Special Economic Zone (ASEZ), raw materials for the production of medicine, and development areas.
4% reduced rate: oils and ghee; supplies used by the handicapped; veterinary medicines.
Corn is taxed at 5%.
10% reduced rate: live animals, cheese.
1% reduced rate: gloves; hygiene products and disinfectants
2% reduced rate: food salt; pencils.
Other Consumption Taxes
Excise duties are levied on cement, tobacco, wine, liquors, cars, beer, oil products and lubricants.

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Corporate Taxes

Company Tax
20% (21% with the national contribution tax)
Tax Rate For Foreign Companies
Resident corporations are subject to corporate income tax on their Jordan-source income, unless an income is raised from sources that originate and relate to Jordanian deposits and funds, in which case this income would be taxed at a rate of 10%.
Non-resident corporations are taxed through withholding tax. Branches of foreign companies are taxed in Jordan at the prevailing corporate tax rates. Foreign branches of Jordanian resident companies are taxed at a fixed rate of 10% of net income.
Capital Gains Taxation
Capital gains are tax-exempt, except for those arising from depreciable assets, the sale of shares in a legal entity and the sale of shares in IT companies that occur after 15 years from the date of their establishment or after 1 January 2019, whichever is earlier.
Main Allowable Deductions and Tax Credits
Amortisation of tangible and intangible assets is tax-deductible. Goodwill can also be deducted. The Jordanian tax code does not include any provisions for start-up costs, but these can usually be deducted in the first year of business activity.
Interest charges (a 3:1 debt-to-equity ratio applies to interest paid on related party debt) and bad debt are generally deductible.
Donations to charitable organisations are deductible up to 25% of taxable income.
Fines are not deductible while taxes can be deducted from the tax base.
Insurance premiums, social security contributions, hospitality expenses, marketing, scientific research, development, and training expenses are deductible.
Tax losses incurred before 1 January 2015 may be carried forward indefinitely. The carryforward is limited to five years for losses incurred after 1 January 2015. Loss carryback is prohibited.
Other Corporate Taxes
Property tax is calculated by local authorities based on the location and size of the property or, in some cases, the rental value of the property (15% on average).
Property transfer taxes amount to 9% of the selling price (5% for registration fees and 4% for sale).
Stamp duties are levied at a rate of 0.3% for private contracts and 0.6% for contracts with the state or public companies.
Social security contributions payable by the employer amount to 14.25% of salary (capped at JOD 3,349 per month).
Other Domestic Resources
Consult Doing Business Website, to obtain a summary of the taxes and mandatory contributions.

Country Comparison For Corporate Taxation

  Jordan Middle East & North Africa United States Germany
Number of Payments of Taxes per Year 9.0 20.8 10.6 9.0
Time Taken For Administrative Formalities (Hours) 96.5 204.0 175.0 218.0
Total Share of Taxes (% of Profit) 28.6 32.1 36.6 48.8

Source: Doing Business, Latest available data.

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Individual Taxes

Tax Rate

Individual Income tax Progressive rate from 5% to 30%
JOD 0 - JOD 5,000 5%
JOD 5,001 to JOD 10,000 10%
JOD 10,001 to JOD 15,000 15%
JOD 15,001 to JOD 20,000 20%
JOD 20,001 to JOD 1,000,000 25%
Over JOD 1,000,000 30%
National contribution tax 1% (for annual income exceeding JOD 200,000)
Allowable Deductions and Tax Credits
Deductions and allowances are set at JOD 9,000 for a single person. A lump-sum deduction of JOD 1,000 is granted to expenses incurred for medical treatment, education, rent and interest on housing. A deduction of JOD 1,000 is granted for the spouse of the taxpayer and for each child (capped at JOD 3,000). Individuals with special needs are granted an additional exemption of JOD 2,000 per year. Personal deductions are capped at JOD 23,000 per family regardless of joint or individual tax returns.
Charitable contributions are deductible up to 25% of the taxable income, or without any limit if the recipient is any of the governmental departments, public or official institutions, or municipalities.
Most business expenses and insurance premiums are also deductible (bad debts, insurance premiums, certain taxes, hospitality and travel expenses, marketing, scientific research, development, and training expenses, etc.).
Special Expatriate Tax Regime
Both residents and non-residents are only taxed on their Jordan-source income.

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Double Taxation Treaties

Countries With Whom a Double Taxation Treaty Have Been Signed
See the list of double taxation agreements Jordan
Withholding Taxes
  • Dividends: 0%
  • Interest: Residents: standard tax rates/Non-residents: 10%/7% (interest from deposits, commissions and profit participations of Islamic banks) + national contribution tax
  • Royalties: Residents: standard tax rates/Non-residents: 10% + national contribution tax.
Bilateral Agreement
The United Kingdom and Jordan are bound by a double taxation treaty.

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Latest Update: April 2024