The UAE introduces its first-ever corporate taxes, set to start in 2023

The UAE introduces its first-ever corporate taxes, set to start in 2023

DUBAI, United Arab Emirates — The United Arab Emirates will be introducing a federal corporate tax on business profits for the first time, the Ministry of Finance announced Monday. The news represents a significant shift for a country that's long attracted businesses from around the world thanks to its status as a tax-free commerce hub. Businesses will be subject to the tax from June 1, 2023. The country's statutory tax rate will be 9% for taxable income exceeding 375,000 United Arab Emirates dirhams ($102,000), and zero for taxable income up to that amount "to support small businesses and startups," the ministry said, adding that "the UAE corporate tax regime will be amongst the most competitive in the world." Individuals will still not be subject to tax on their incomes from employment, real estate, equity investments or other personal income unrelated to a UAE trade or business, the ministry said. The tax also won't be applied to foreign investors who don't conduct business in the country. As for what constitutes profit, corporate tax will apply on "the adjusted accounting net profit" of the business. Free zone business, meanwhile — thousands of which exist in the country — can "continue to benefit