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World risk · Regulation and compliance

Bahrain makes its 10% corporate income tax law

The test Between 3 Nov 2026 and 3 Nov 2027, Bahrain issues, by law or decree-law published in the Official Gazette, a corporate income tax on local businesses (the 10% tax proposed in December 2025 or a variant).

Not under way · Confidence: medium · Reviewed 3 Nov 2026 · Scores from 1 to 10

This page answers: What could happen, how it is scored, and who is exposed?

Using this page
  1. Read the two scores: Likelihood and Impact are kept apart.
  2. Check what is happening, each fact with its source.
  3. Use the calendar for the dates to watch.

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Likelihood
4Elevated steady this month
Impact
5Elevated steady this month
Breadth4
Depth2
Duration9
Hard to substitute4
Canada pointNot added0

Impact is the average of the four parts, rounded, plus one point when Canada is directly hit on two or more channels, up to 10.

Two separate scales from 1 to 10. Strature never multiplies or merges them.

What changed

Dated, newest first

  1. KPMG tax news of 11 Oct 2026 still lists the draft CIT law [6]

Why it matters

Bahrain's cabinet sent a draft 10% corporate income tax to the legislature on 29 Dec 2025, as part of a package to curb a debt that S&P says carries high risk. Advisers expected the law within months and a start on 1 Jan 2027. On 11 Oct 2026 KPMG still listed it as a draft.

Why Likelihood 4 Drivers: high debt and rating cuts; a government bill that advisers expected within months. Brakes: still a draft on 11 Oct 2026, ten months after referral, with the planned 1 Jan 2027 start under two months away; the war.

The other facts on file (6)
  • Draft CIT law referred to the legislature: 10% on income above BD200,000; revenue above BD1m or income above BD200,000 [1] (26 Apr 2026)
  • Chamber of Commerce closed consultation on the draft [1] (26 Apr 2026)
  • 61 articles; National Bureau for Revenue; fiscal years from 1 Jan 2027; final law and regulations expected within months [2] (Mar 2026)
  • Package: higher fuel and utility tariffs, state-company dividends, 20% admin spending cut; S&P cut Bahrain to B in Nov 2025 [3] (29 Dec 2025)
  • Royal order of 29 Apr 2026 extended the assembly's term to December 2027 [5] (Apr 2026)
  • PwC summary (reviewed 26 Jul 2026): no general corporate income tax in Bahrain [7] (26 Jul 2026)

Where it sits

UAEQATAR11. Bahrain makes its 10% corporate income tax law: Elevated impact · possible (placed at the country)1 Bahrain makes its 10%corporate income tax lawElevated impact · possibleBAHRAIN CORPORATE TAX MADE LAW0200 kmat 26°NMap data: Natural Earth (public domain).
UAEQATAR11. Bahrain makes its 10% corporate income tax law: Elevated impact · possible (placed at the country)1 Bahrain corporatetax made lawBAHRAIN CORPORATE TAX MADE LAW0200 kmat 26°NMap data: Natural Earth (public domain).

How it spreads

Sample, no data on file. No cited flows by country on file for this risk.

If

Between 3 Nov 2026 and 3 Nov 2027, Bahrain issues, by law or decree-law published in the Official Gazette, a corporate income tax on local businesses (the 10% tax proposed in December 2025 or a variant).

Not under way

Channels 4 on the card

  1. CanadaNo Canadian loss sourced.
  2. BusinessLocal companies above the thresholds would pay 10% on profits above BD200,000 from 2027 [2].
  3. Public financesA new tax base would ease a deficit and debt that drove rating cuts [3].
  4. InvestmentBahrain would join its Gulf neighbours; DLA Piper calls it the final Gulf country to bring in such a tax [4].

Sectors 1

  • Banks and insurers

Countries 1

Who is exposed

No figure on file: Bahrain.

Sectors
Banks and insurers

Three scenarios and their signposts

  1. S1

    On time

    The law is published and applies from 1 Jan 2027.

  2. S2

    Late

    Parliament or the war delays the law; it is published in 2027 with a later start.

  3. S3

    Shelved

    The tax is put off beyond the window as the war hits business.

The signposts of each scenario
PathSignpost
S1Publication in the Official Gazette before January 2027
S2Executive regulations still unpublished in early 2027
S3A cabinet statement deferring the tax

No probability is given for the three paths.

Dates to watch

Calendar

The dates to watch

A dot is a day, a bar a month or a year; a hollow mark is tentative. The line marks today.

  1. 1 Jan 2027 Planned start of the tax for fiscal years beginning on this date [2] Tentative · Outside event

    Remind me

  2. Dec 2027 End of the extended legislative term [5] Declared · Outside event

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SourceStrature world-risk card; the dates cite the sources below.
Exhibit R-3 · BAHRAIN · strature.net

The other side

A broad tax would make Bahrain's finances less reliant on oil and on Gulf aid, which rating agencies have asked for [3]; the BD200,000 threshold spares small firms [4].

Connected in Strature

Sources

7 sources, numbered as the text cites them

  1. Bahrain and GCC tax news, 26 April 2026. KPMG in Bahrain · 26 Apr 2026 · Industry · confidence high · retrieved 3 Nov 2026
  2. Draft Bahrain Corporate Income Tax (CIT) Law: Bahrain Tax Alert. KPMG in Bahrain · 2026-03 · Industry · confidence high · retrieved 3 Nov 2026
  3. Bahrain prepares new fiscal reforms to curb rising debt. The National · 29 Dec 2025 · News · confidence medium · retrieved 3 Nov 2026
  4. Bahrain announces corporate income tax regime. DLA Piper · 30 Jan 2026 · Industry · confidence medium · retrieved 3 Nov 2026
  5. Bahrain, April 2026. International IDEA, Global State of Democracy Initiative · 2026-04 · International body · confidence high · retrieved 3 Nov 2026
  6. Bahrain and GCC Tax News, 11 October 2026. KPMG in Bahrain · 11 Oct 2026 · Industry · confidence high · retrieved 3 Nov 2026
  7. Bahrain: Corporate - Taxes on corporate income. PwC Worldwide Tax Summaries · 26 Jul 2026 · Industry · confidence high · retrieved 3 Nov 2026

Reviewed 3 Nov 2026 · version 1 · last change: first review · All risks