National Energy Services Reunited Corp.

7. INCOME TAXES

NESR is a holding company incorporated in the British Virgin Islands (“BVI”), which imposes a 0% statutory corporate income tax rate on income generated outside the jurisdiction. NESR’s subsidiaries operate across multiple tax jurisdictions in the MENA region, where statutory tax rates generally range from 0% to 35%. However, the adoption of Domestic Minimum Top-Up Taxes (DMTT) under the OECD Pillar Two framework has, in many cases, resulted in effective tax rates exceeding local statutory minimums.

The Company recorded income tax expense of $8.7 million with an effective tax rate of 20.2% for the three-month period ended September 30, 2026, income tax (benefit) expense of($5.5) million with an effective tax rate of negative 44.9% for the three-month period ended September 30, 2025, $30.7 million with an effective tax rate of 23.1% for the nine-month period ended September 30, 2026 and $2.1 million with an effective tax rate of 4.6% for the nine-month period ended September 30, 2025, in the Condensed Consolidated Statements of Operations.

The recognition of an income tax benefit for the three-month period ended September 30, 2025, despite positive income before income tax, primarily reflects adjustments to the Company’s uncertain tax positions and unrecognized tax benefits totaling $9.2 million on a net basis. These adjustments were non-recurring in nature and do not indicate any change in the Company’s underlying profitability and/or statutory tax obligations in its taxable jurisdictions. Excluding these discrete items, the effective tax rates for the three- and nine-month periods ended September 30, 2025, were 29.9% and 24.8%, respectively.