UAE Cabinet approved amending certain provisions on VAT to enhance transparency in the tax regime

The Executive Regulations of Federal Decree-Law No. 8 of 2017 on Value Added Tax (VAT) have been amended by Decision No. 100 of 2024, which was approved by the UAE Cabinet and released by the Ministry of Finance. The purpose of these changes is to guarantee adherence to UAE tax laws and improve transparency within the tax system. 

Undersecretary of the Ministry of Finance Younis Haji Al Khoori stressed the dedication to improving the tax environment in the United Arab Emirates, stressing the significance of striking a balance between increasing tax revenue collection and fostering an investment climate.

One of the most important improvements is the VAT exemption for investment fund management services, which will encourage the investment management industry to flourish. Furthermore, a number of services associated with virtual assets will be free of charge, fostering innovation and strengthening the UAE's standing as a centre for virtual asset investment. 

The revisions further provide an exemption for in-kind gifts between government and charity organisations, with a maximum value of AED 5 million per year, enabling the donors to recoup the VAT they have paid. Furthermore, the Federal Tax jurisdiction will receive jurisdiction to deregister individuals under particular situations, enhancing tax compliance and improving the efficiency of tax administration.

These adjustments are a reflection of the Ministry's continuous efforts to resolve issues raised by the business community, foster economic expansion, and uphold the UAE's standing as a desirable location for investments.

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