Imagine a rustic of Southeast Asia, by which income isn’t taxed in any respect. Without income tax, without sales tax and even tax on capital gains.
Welcome to Brunei Darussalam, a nation wealthy in oil known from the ultra-minimalistic tax system and world-class public services.
Corporation tax: the important goal of the federal government
Brunei’s only big tax is corporate income tax. The standard corporate tax rate is eighteen.5% – one among the bottom in Southeast Asia. However, firms from the oil and gas sector are subject to a special rate of 55% on the premise of the Act on income tax (oil) from 1963.
0% tax on personal income
In Brunei, natural individuals pay zero personal income tax – this is applicable to each residents and foreign employees.
Instead, all employed residents and steel residents are obliged to bring a 5% monthly remuneration to the staff’ trust fund (TAP), in addition to a further 3.5% to a further contributory pension (SCP) – each a part of the national national social insurance program.
In addition, Brunei doesn’t impose taxes on sale, export, salary, production or capital profits. Real estate tax is barely applied to business real estate.
Die of a tax policy
Brunei doesn’t impose tax on dividends, interest, license fees or technical services on domestic firms.
However, firms that usually are not residents are subject to a deduction tax: 2.5% on interest and 10% on license fees and technical services.
Free public services and generous subsidies
Despite the lightweight tax system, Brunei ensures that residents have full access to public services. The government provides free education and health care and strongly subsidizes the essential goods corresponding to rice, sugar, electricity, water and fuel.
Thanks to modern infrastructure, the efficient transport system and high political stability, Brunei maintains consistent public expenses, supported by strong revenues from oil and gas exports. According to the Ministry of Finance and Economics, Brunei has about 455,000 people in March 2025.
Magnet for investors
Thanks to low legal tax and various incentives – including exemptions from import duties and pioneering status (which offers as much as 20 years of tax exclusion) – Brunei is a beautiful place for foreign investors who wish to arrange firms with out a bothersome tax system.
The government offers as much as 1% of the export tax option and placing tax exemptions on foreign percentage of loans for qualifying production investments.
