The main law governing corporate taxation in Kuwait is Kuwait Decree No. 3/1955 On Kuwait Income Tax. Kuwait Decree No. 3/1955 applies only to foreign entities conducting business in Kuwait and imposes a 15% corporate tax on their net profits. Local Kuwaiti owned companies (100% Kuwaiti or Gulf Corporation Council (GCC) national ownership) are completely exempt from corporate income tax.

However, as of 1 January 2025, Kuwait has introduced a domestic minimum top-up tax under the pillar two framework of the Organisation for Economic Co-operation and Development (OECD). The domestic minimum top-up tax applies a 15% minimum effective tax rate on multinational enterprises with global consolidated revenues of at least EUR 750 million.

While foreign companies and multinational enterprises may be subject to either Kuwait Decree No. 3/1955 or the new domestic minimum top-up tax, Kuwaiti owned companies remain exempt from tax and are not affected by either tax regime.