The UAE Cabinet has introduced amendments to the Value Added Tax (VAT) law, announced by the Ministry of Finance on Saturday, which include new exemptions aimed at promoting investment and easing the burden on charitable entities.
According to a WAM report, the changes grant VAT exemptions to three key services: investment fund management, certain virtual asset services, and in-kind donations between government and charitable entities. These services, previously taxed at 5%, will now benefit from the exemptions, allowing for enhanced investment opportunities and support for charitable causes.
Under the new rules, in-kind donations between government bodies and charities, valued up to Dh5 million over 12 months, will be tax-exempt, enabling these entities to maximize the benefits of goods received.
Additionally, the Federal Tax Authority has been given the power to de-register taxpayers in certain cases, further strengthening tax compliance across the country.
The Ministry of Finance emphasized that these amendments are part of an ongoing effort to refine the UAE’s tax landscape, aligning with international best practices and enhancing the country’s appeal to businesses and investors.
Younis Haji Al Khoori, Undersecretary of the Ministry of Finance, stated, “These changes will simplify tax procedures, reduce misunderstandings, and support the UAE’s business environment.” The adjustments also reflect recommendations from stakeholders and experiences from implementing the VAT law in previous years.