No Plans to Tax Remittance in UAE

“There is no intention and no plans to impose taxes on the income of individuals in the UAE…The Government may not proceed with such a significant move before they are thoroughly studied in terms of their socioeconomic impacts” said Obaid Humaid Al Tayer, Minister of State for Financial Affairs, at the Federal National Council, as quoted by Gulf News.

He did confirm that there were studies in initial stages and that the government is considering introducing corporate tax law but denied a decision or draft law made saying, “Any studies will take into account the amount of these remittances and the socioeconomic impact on the UAE’s economy and foreign workers… We are still studying the corporate tax law, which is still in its initial stages and it’s being discussed with local governments and no agreement has been reached so far.”

Al Tayer also said in a report that there are discussions about value-added tax (VAT) at GCC level and might be implemented in 2018 or 2019 once they have reached an agreement by the beginning of next year. Tax takes at least 18 months to be implemented because the government still needs to determine which goods and services are taxed and which are zero-taxed and other certain measures and the private-sector must be given their own time.

Al Tayer was speaking after the Federal National Council passed the UAE’s federal budget of Dh46 billion for 2016 which was approved as part of three-year federal spending plan of Dh140 billion for 2014-2016.The balanced budget has revenues and expenditure of Dh48.557 billion.


Education and health allocations would be increased to boost the two sectors and provide health insurance to every citizen. The federal government gives priority to services that touch the lives of people. Fifty percent of the budget is allocated to sectors including education, which received the maximum allocation of Dh6.048 billion, social development, with allocated Dh3.017 billion and increased allocations for public services and health.

Al Tayer says that the budget is responsive to new initiatives and programs endorsed by the Cabinet and its members.

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