Wednesday, 2 February 2022

UAE has the lowest corporate tax rate in GCC

The Ministry of Finance has announced that the UAE Federal Corporate Tax will be levied on business profits. The financial years come into e...

The Ministry of Finance has announced that the UAE Federal Corporate Tax will be levied on business profits. The financial years come into effect in the financial years beginning on or after June 1, 2023. The GCC, a six-nation Gulf Cooperation Council, has set a corporate tax rate of nine per cent, the lowest ever. Bahrain is the only country that does not impose corporate tax in the GCC. Qatar, Oman, Saudi Arabia and Kuwait have already implemented corporate taxes.

In Saudi Arabia, the income tax rate is 20 per cent of net adjusted profits, the highest in the GCC region.

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Omani companies and foreign firms with a firm presence in Oman are required to pay a corporate tax at the rate of 15 per cent on the profits of Omani companies with a permanent presence and foreign firms profit at the rate of 15 per cent. Kuwait and Qatar, on the other hand, have flat rates of 15 per cent and 10 per cent, respectively. Saad Maniar, senior partner at Corporate Tax Crow, said the nine per cent corporate tax was a step in the right direction for the sustainable future of the UAE economy. He added that with the introduction of corporate tax, the need to increase development will also increase, which will further strengthen overall economic growth. Nasser Moosa, CEO of Service Provider PRO Partner Group, a leading UAE company, said the latest government move will be rolled out across the UAE by 2023.

If profits rise above AED 375,000, the UAE imposes a corporate tax of 9% on profits. Musa said the development was expected to some extent. Does not affect individuals or real estate.