Aramco to Cut Oil Tax to Lure Investors

Saudi Arabia has promised it will reduce the overall tax rate paid by its national oil company to make its 2018 initial public offering—potentially one of the largest in history—more appealing to investors. “Definitely the fiscal regime will be changed," Saudi Arabian Oil Co. Chief Executive Officer Amin Nasser said in a Bloomberg Television interview on Tuesday in Davos, Switzerland. “When you look at the fiscal regime and the taxes, it has to be aligned with other listed companies,” Bloomberg reported. Aramco, as the company is commonly known, currently pays a 20% royalty on its revenue plus 85% tax on income, Nasser said. He declined to say what tax rate the kingdom is considering. Saudi officials say Aramco’s tax rate would not need to be slashed because the company— considered the crown jewel of the country’s economy—is able to make a profit even when oil prices plunge.