DUBAI: The United Arab Emirates will introduce a corporate tax from mid-2023, the finance ministry said on Monday, a major change in course as the country seeks to diversify its income.
The Gulf financial centre, long known as a tax haven and regional headquarters of multinational companies, will be taxed at 9% from June next year on business profits of more than 375,000 AED ($102,000), a statement said. Will put
The announcement is the latest significant move by the United Arab Emirates, which this year has changed from Friday-Saturday weekend to Saturday and Sunday to align with global markets.
"The UAE corporate tax regime will be one of the most competitive in the world," said a statement carried by the official WAM news agency. At the low end of corporate taxes worldwide is nine percent.
The ministry said there is no plan to levy personal income tax or capital gains tax from real estate or other investments.
The United Arab Emirates, a major oil exporter but also a major player in trade, trade, transport and tourism, is diversifying to reduce its reliance on crude.
It is also facing increasing competition from neighboring Saudi Arabia, the world's biggest oil exporter, which is ramping up its drive to diversify its economy and attract foreign businesses.
"With the introduction of corporate tax, the UAE reaffirms its commitment to meeting international standards for tax transparency and preventing harmful tax practices," Under Secretary of the Ministry of Finance Younis Haji Al Khouri said in the statement.
The tax incentives in the UAE's free trade zones will remain the same.