UAE is open to imposing taxes, Economy Minister says

Abu Dhabi: The UAE is open to imposing taxes but any decision will be evaluated thoroughly by the government before implementation, the Minister of Economy said on Sunday.
“Any decision on any issue, there is a process in the government. We will discuss it, evaluate it how it effects our competitiveness. We are part of the GCC and there should be a common policy. So in future, if this serves the government and the people it could open to taxes just as other nations have,” said Sultan Bin Saeed Al Mansouri.
The minister did not elaborate on what kind of taxes the government is considering imposing nor give any timeline.
The UAE has been for a while considering imposing taxes on corporate, tax on remittances and Value Added Tax and some others. The UAE imposing taxes gains importance in view of the ongoing low oil prices due to which the revenues had declined sharply.
The Ministry of Finance in August has said that the UAE has been conducting a series of studies on the implementation of a draft VAT (Value Added Tax) law, along with the other GCC countries.
The draft law is still pending and under negotiation due to the absence of a final agreement between GCC countries on the tax rate and a list of tax exemptions, The Ministry of Finance said.
Economic implications
According to the ministry, it has conducted several feasibility studies on taxation and its social and economic implications, the latest being in 2014, which was completed in early 2015.
“The studies will determine the impact of taxes on the growth of the regional economy and UAE’s global competitiveness,” the Ministry of Finance said.
An announcement will be made once a final agreement on imposing a VAT law is reached. Concerned sectors and entities will have around 18 months after the enactment of the law to implement and fulfill the requirements of their tax obligations.
With regards to corporate tax law, the Ministry said it conducted a number of studies on the effects of imposing taxes in the UAE and presented it to relevant authorities. The draft law is still under study with regards to the tax rate to be imposed.

Source: http://www.gulfnews.com