The UAE Minister for Foreign Trade Thani Bin Ahmed Al Zeyoudi clarified that the country will not levy an income tax for the time being.
Zeyoudi, during a business talk on Bloomberg TV, said, “It is not at the table at all now.”
Earlier in February, the UAE introduced a 9% Federal corporate tax.
The decision would take effect from June 1, 2023.
The minister said that businesses have received the corporate tax news in a “positive manner.”
The Ministry of Finance is expected to announce more details clarifying how the corporate tax will be imposed.
The UAE corporate tax regime has been designed to incorporate best practices globally and minimise the compliance burden on businesses. Corporate tax will be payable on the profits of UAE businesses as reported in their financial statements prepared in accordance with internationally acceptable accounting standards, with minimal exceptions and adjustments.
The corporate tax will apply to all businesses and commercial activities alike, except for the extraction of natural resources which will remain subject to Emirate level corporate taxation.
With a standard statutory tax rate of 9 percent and a 0 percent tax rate for taxable profits up to Dhs375,000 to support small businesses and startups, the UAE corporate tax regime will be amongst the most competitive in the world.