Tax Updates from the United Arab Emirates for July 2023

UAE Corporate Tax Free Zone Public Consultation paper

On 19 July 2023, the Ministry of Finance has recently released a Consultation Paper on Free Zones on the proposed framework for the classification of Qualifying Activities and Excluded Activities for Free Zone companies with the objective of gathering valuable inputs and suggestions from relevant stakeholders.

The deadline to submit the response on the topics outlined is extended from 2nd August to 9th August 2023.

UAE Cabinet Decision Establishing Executive Regulations for New Tax Procedures Law

The Cabinet Decision No.74 of 2023 on the Executive Regulation of Federal Decree-Law No. (28) of 2022 on Tax Procedures (“New Executive Regulation”), which repealed Cabinet Decision No. (36) of 2017 on the Executive Regulation of Federal Law No. (7) of 2017 on Tax Procedures and its amendments (“Previous Executive Regulation”). The new Executive Regulation was published in the Official Gazette and will be effective as of 1 August 2023.

This decision covers various matters, including record-keeping requirements, tax registration, deregistration, and amendment procedures, rules on legal representatives and tax agents, voluntary disclosures, tax audits, tax assessments, tax refunds, reconciliation in Tax Evasion crimes and the terms and conditions for such reconciliations.

UAE Ministry of Finance announces schedule of administrative penalties for corporate tax violations

The UAE Ministry of Finance (MoF) announced the issuance of Cabinet Decision No. (75) of 2023 regarding administrative penalties for violations related to the Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses (Corporate Tax Law), effective from 1st August 2023.

The schedule of violations and administrative penalties annexed to the decision includes 13 description of violations and respective administrative penalty amount.

Cabinet decision on conditions for Qualifying Investment Funds

The UAE Ministry of Finance has announced the issuance of Cabinet Decision No. 81 of 2023 on additional conditions for qualifying investment funds, which may be exempted from tax under the new Corporate Tax Law.

This decision provides conditions to exempt an investment fund and Real estate investment trust from corporate tax.

Extension of Temporary suspension of export of ferrous scrap and waste paper

The Dubai Customs vide Customs Notice No. (06/2023) has extended the temporary suspension of export of ferrous scrap and waste paper until 19/09/2023. The items falling under the suspension has also been detailed in the notice issued on 6th July 2023.

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