United Arab Emirates Tax Updates April 2022

Implementation of 2022 Edition of the WCO Harmonized System (HS) Nomenclature

The Unified Commodity Description and Coding Table of the GCC States has come into force from 16 February 2022 on the basis of the Harmonized System - Edition 2022. The Federal Decree No. (85) of 2007 of the Common Customs (Regulation) Law for the GCC states has been repealed and replaced by the Federal Decree Law No. (15) of 2022.

Dubai issues First Law Regulating Virtual Assets

The Emirate of Dubai has issued Dubai Law No. 4 of 2022 dated 28 February 2022 on the Regulation of Virtual Assets in the Emirate of Dubai (“Dubai Virtual Assets Law” or the “DVAL”).

The DVAL will become effective on its publication in the Official Gazette. Its scope will be limited to authorising the conduct of activities relating to virtual assets in the Emirate of Dubai only (including free zones and special development zones but excluding the Dubai International Financial Centre).

The law establishes a separate authority called the “Dubai Virtual Assets Regulatory Authority” (the “VARA”) to oversee the regulation and authorisation of virtual asset related activities in Dubai. VARA will report into the Dubai World Trade Centre (“DWTC”)

Any person who requires an “authorisation” from VARA to conduct virtual asset services, must operate in the Emirate of Dubai and must obtain a trade licence from the relevant commercial authority in Dubai.

The Ministry of Human Resources & Emiratisation (“MOHRE”) has announced an overhaul to the labour laws in the UAE

The new UAE Labour Law (Federal Decree Law No. 33 of 2021) (“New Law”), which came into effect as of 2 February 2022 (“Effective Date”), seeks to address changes in the work environment, align UAE labour relations with international best practices, and recognise the need for atypical and/or flexible working structures. The New Law has replaced Federal Law No. 8 of 1980, as amended (“Original Law”) in its entirety, and it is the most significant amendment to UAE labour legislation since the Original Law’s enactment.

The key amendments inter-alia include changing the existing unlimited contracts to limited contracts by 1 February 2023.

UAE Cabinet Approves Pending Tax Treaty with the Democratic Republic of the Congo

On 28 February 2022, the United Arab Emirates Cabinet approved the treaty, signed 12 October 2021 with the Democratic Republic of the Congo.

Tax Treaty between Guyana and the UAE Signed

As reported by Newsroom Guyana, the agreement – Avoidance of Double Taxation and the Prevention of Fiscal Evasion with respect to Taxes on Income and Capital – was signed on 24 March 2022.

As part of this new agreement too, a specific carve-out was made for oil and gas.

Tax Treaty between Antigua and Barbuda and the UAE has Entered into Force

According to an update from the UAE Ministry of Finance(list of Tax Treaties) , the income tax treaty signed on 15 January 2017 with Antigua and Barbuda entered into force on 24 February 2022.

The UAE Ratifies Pending Protocol to Tax Treaty with Ukraine

According to an update from the UAE Ministry of Finance (list of Tax Treaties), the United Arab Emirates Cabinet approved the pending protocol to the 2003 income and capital tax treaty with the Ukraine on 31 January 2022.

Chile Lower House Ratifies Tax Treaties with the United Arab Emirates

The Chile Lower House of Parliament on 3 March 2022 adopted the ratification law bills regarding the tax treaty signed between Chile and the United Arab Emirates on 31 December 2019 (Bill No.

Corporate Tax