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UAE takes steps for smooth rollout of corporate tax

The FTA invited taxpayers looking for more information about Corporate Tax to participate in the virtual awareness workshops. (WAM)
  • The Ministry of Finance calls on public to rely only on official publications for information on the tax law, while Dubai launches an integrated training programme for awareness
  • The new "Tax Agents Classification" initiative, meanwhile, aims to simplify tax compliance for taxpayers by allowing them to select a specialized Tax Agent based on their sector

ABU DHABI, UAE – As the date for the new corporate tax fast approaches, the UAE and Dubai governments have embarked on several initiatives to prepare the public for its implementation from June 1, 2023.

The UAE’s Ministry of Finance (MoF) and the Federal Tax Authority (FTA) are at the forefront of these endeavors, providing clarity and guidance on the new tax law.

The MoF has urged the public to depend solely on official publications and posts from the MoF and the FTA for accurate information regarding Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (the Corporate Tax Law).

The Ministry warned against unverified posts by private parties on social media and other platforms, reminding citizens that misleading interpretations and analyses of the Corporate Tax Law might incur legal consequences under Federal Decree-Law No. 34 of 2021 on Combatting Rumours and Cybercrime.

The UAE’s Federal Tax Authority has introduced the “Tax Agents Classification” initiative to simplify tax compliance for taxpayers. (WAM)

Training program

The Department of Finance for the Government of Dubai (DoF), meanwhile, has initiated an integrated training program, IMTITHAL (Competence), to raise corporate tax awareness.

The program is unique in its approach, employing interactive participation and presenting realistic examples related to various economic sectors. Dubai Chambers and knowledge partner KPMG support the workshops.

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DoF Director General Abdulrahman Saleh Al Saleh emphasized that the IMTITHAL program aims to ensure high levels of compliance with the corporate tax regulations among Dubai-registered companies.

Mohammad Ali Rashed Lootah, President and CEO, Dubai Chambers, praised the initiative, stating that it reflects the Chamber’s commitment to educating Dubai’s business community about new legislations impacting their businesses.

Explanatory guide

To provide further clarity on the new tax law, the Ministry of Finance has issued an Explanatory Guide for Federal Decree-Law No 47 of 2022 on the Taxation of Corporations and Businesses. The guide provides an article-by-article explanation of the law and its intended effects, and includes details about various features of the UAE’s Corporate Tax regime that encourage business activity and minimize the compliance burden for taxable persons.

Undersecretary of the Ministry of Finance, Younis Haji Al Khouri, said the guide reflects the Ministry’s commitment to supporting and providing information to taxable persons before the law’s entry into effect.

‘Tax Agents Classification’

Meanwhile, the FTA has introduced the “Tax Agents Classification” initiative, aiming to simplify tax compliance for taxpayers. The initiative offers an online procedure for taxpayers to select a specialized Tax Agent based on the sector their taxable economic activity belongs to. The initiative classifies over 70 percent of the total registered agents according to their sectors.

Khalid Ali Al Bustani, Director-General of the FTA, said the initiative aligns with the ‘We the UAE 2031’ vision to advance the UAE’s position as a center for the new economy by creating the world’s most dynamic economy. In a series of moves that promise transparency and efficiency, the UAE and Dubai governments continue to bolster confidence among businesses as the country gears up for the corporate tax’s implementation from June 2023.