UAE Introduces VAT Exemptions Under Revised Law
Amended VAT Law Exempts Investment Funds and Virtual Assets, Boosting UAE's Economy
UAE Approves VAT Exemptions to Boost Investment and Support Innovation
The UAE Cabinet has approved amendments to the Federal Decree-Law on Value Added Tax (VAT) set to exempt investment fund management services from VAT to stimulate growth in the investment management sector and enhance the UAE’s attractiveness, the Ministry of Finance said. Major investment hub.
In addition to exemptions for in-kind donations between charitable and government entities valued above Dh5 million above 12, certain services related to virtual assets will also be exempt from VAT as part of efforts to support innovation and advanced financial technology. – Period of one month, based on the terms of lawful supply. In line with the VAT Act, this enables contributors to recoup the VAT paid on these in-kind contributions, lessening the financial strain on these organizations and enhancing their social role.
The Ministry highlighted that the changes are part of continuous efforts to reform the tax environment in the UAE with the aim of striking a balance between collecting tax revenue, enhancing the investment environment and attracting more businessmen and investors to the country.
Ministry of Finance Undersecretary Younis Haji Al Khoori said the ministry is committed to improving our regulations and coordinating with relevant partners from the public and private sectors to improve the UAE’s business environment.
“We believe these amendments will help reduce misunderstandings or misapplications of the law, simplify procedures for taxpayers in line with international best practices, and ultimately provide a better quality of life for all.”
The amendments are designed taking into account the GCC Unified VAT Agreement, past experiences, challenges faced by the business community and stakeholder recommendations.
Amid the ongoing economic transition, the Ministry of Finance has introduced tax schemes and programs aligned with international best practices to address the challenges arising from these developments, promote economic growth and strengthen support for the business sector.
