The UAE Ministry of Finance (MoF) has announced the launch of a digital public consultation regarding the development of a domestic minimum tax in the country. The consultation will be open from March 15 to April 10, 2024.
Relevant stakeholders will be asked to provide their views regarding the implementation of the Global Minimum Tax (GMT) or Global Anti-Base Erosion Model Rules (Pillar Two) (GloBE Rules) as well as other tax matters in the UAE.
The digital public consultation reflects the Ministry’s belief in the importance of consulting with all stakeholders including the multinational groups operating in the UAE, advisors, service providers, and investors, officials said in a press release.
The consultation is split into two parts. The first will look at potential policy design options for the implementation of the GloBE Rules in the UAE. The Organisation for Economic Co-operation and Development (OECD) has published the GloBE Model Rules that serve as the model legislation for jurisdictions wishing to implement qualified rules.
The second part of the consultation will ask stakeholders to provide views on the introduction of substance-based incentives to be applied in the UAE, which would form part of the UAE Corporate Tax regime.
The UAE recently introduced a new corporate tax law, which reshaped the nation’s fiscal landscape. As a result, mainland companies will be subject to a standard corporate tax rate of 9% on their taxable income over Dh375,000.
Last month, the UAE Federal Tax Authority (FTA) announced the deadlines for taxable persons subject to corporate tax to apply to register with the FTA and avoid violating tax laws. Companies that fail to meet them will face fines of Dh10,000 ($2,700).
