KPMG’s analysis of Oman’s State Budget 2023

The Sultanate of Oman, per Royal Decree 1/2023, issued the State’s General Budget for the Fiscal Year 2023. The 2023 budget is prepared in accordance with Oman Vision 2040 and the Tenth Five-Year Development Plan (2021-2025), which aims to ensure financial, economic and social stability.

In addition, the Ministry of Finance has also issued a Guide to the State Budget which includes the 2022 preliminary results. As per the 2022 preliminary results:

  • Revenues at RO 14.2 billion increased by 35% compared to the budgeted revenue of RO 10.6 billion
  • Expenses at RO 13.1 billion increased by 8% compared to the budgeted expenses of RO 12.1 billion
  • Oman is expected to record its first surplus (RO 1.15 billion) since 2013 compared to the budgeted deficit of RO 1.55 billion

Highlights of Oman’s 2023 budget

  • The budget is based on an oil price of USD 55/bbl compared to USD 50/bbl in the Tenth Five-Year Plan and the 2022 budget. The average price of oil in 2022 was USD 94/bbl. 
  • Oil and gas revenues are budgeted at RO 6.7 billion, including oil revenues of RO 5.3 billion and gas revenues of RO 1.4 billion. These constitute 67% of the State’s total revenues.
  • Setting-up the Integrated Gas Company for purchase, transportation and sale of natural gas means this budget records gas revenues (RO 1.4 billion) net of gas purchase and transportation expenses. The 2022 budget estimated gas revenues at RO 2.8 billion and gas purchase and transportation expenses at RO 1.6 billion.
  • Non-oil and gas revenues are budgeted at RO 3.3 billion.  These constitute 33% of the State’s total revenues and include Excise Tax and VAT revenues estimated to increase by 10% to RO 590 million and corporate income tax by 20% to RO 560 million.
  • New expenditure items for projects with development impact and social protection subsidies, among others, have been included in this budget.
  • The deficit is estimated at RO 1.3 billion, which is 13% of revenues and 3% of the GDP expected in 2023.
  • The government seeks to achieve its economic and social development objectives as detailed in the Guide to the State Budget, Tenth Five-Year Plan and Oman Vision 2040 through a number of measures and initiatives.

 

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Oman's State Budget 2023

KPMG analysis



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