UAE’s Corporate Tax a catalyst for economic transformation, say experts

UAE’s Corporate Tax a catalyst for economic transformation, say experts

Globally, the average corporate tax rate is 23.37 per cent, rising to 25.43 per cent when considering GDP. Compared to this, UAE’s 9 per cent rate stands out as one of the world’s lowest, ranking third, and the country is among the few OECD members with such rates.

Rakesh Nair, Director – Corporate Tax, Crowe UAE, said: “After the UAE signed the BEPS (base erosion and profit shifting) inclusive framework in 2018, everyone expected corporate tax to be introduced in a humane way. MNCs (looking to invest in the UAE) would need a stable environment, rate and policies which would be adopted.” OECD’s BEPS targets companies shifting profits to lower tax regions, aiming to close international taxation gaps by curbing tax avoidance strategies like inversions and relocating intangibles.

Nair added: “Compared to the global tax policy, the rate here pretty competitive. If you see the rate in the UK, it is 25 per cent. If you see the rate in the US, it is 21 per cent. While doing business in the UAE, you benefit from a world-class infrastructure, a strategic location to do the work, and a business-friendly environment.”

Moreover, the compliance burden for small and medium companies is minimal. “If you