The UAE’s Ministry of Finance had on Monday announced a federal corporate tax on business profits from June 1, 2023.

With a standard statutory tax rate of 9 per cent, the UAE corporate tax regime will be among the most competitive in the world.

Excise tax
It is levied on specific goods which are typically harmful to human health or the environment. Consumers need to pay more to buy such goods. The aim is to “reduce consumption of unhealthy and harmful commodities while also raising revenues for the government that can be spent on beneficial public services”.

The tax is levied on carbonated drinks, energy drinks, tobacco, electronic smoking devices and tools, liquids used in such devices and tools, and sweetened drinks.

Value Added Tax
VAT is a tax on the consumption or use of goods and services. A 5 per cent VAT is levied at the point of sale. Businesses collect and account for the tax on behalf of the government.

“VAT will provide the UAE with a new source of income which will be continued to be utilised to provide high-quality public services. It will also help government move towards its vision of reducing dependence on oil and other hydrocarbons as a source of revenue,” the official government website states.

source : https://www.khaleejtimes.com/