TaxSavvyKW

Customs exemption through KDIPA

Can KDIPA exempt our imported equipment from customs duty?

The situation

Customs exemptions for equipment and raw materials are among KDIPA incentives; GCC customs duty is generally 5% of CIF value.

The law

  • Law No. 116 of 2013 on the promotion of direct investment (KDIPA): KDIPA can licence up to 100% foreign owned entities and grant incentives including tax relief, outside the general 49% limit

What it means for you

Example: KWD 500,000 of equipment at 5% duty is KWD 25,000. An exemption can be significant for manufacturing projects. Request it with the application and keep import documents to support it.

What to do

  1. Estimate imports.
  2. Compute duty saving.
  3. Request the exemption.
  4. Keep import records.

We can do this for youKDIPA licence for a 100% foreign owned entity or branch: KWD 3,000

Related