The businesses across the UAE have adopted the new tax structure and increasing their compliance on regulations by posting 2.42 per cent growth in registration for value-added tax (VAT) during the first quarter of 2022, latest data shows.
The Federal Tax Authority (FTA) on Wednesday said the number of VAT registrants increased to 367,157 in January-March quarter compared to 358,468 in the same quarter last year.
The FTA board of directors, who met under the chairmanship of Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, Deputy Prime Minister, Minister of Finance, and Chairman of the FTA board of directors, adopted the authority’s financial statements for 2021.
The meting, which was held at the authority’s headquarters in Dubai on Wednesday, reviewed a report on the FTA’s plans to develop and enhance the tax system’s procedures and bring them in line with best international practices. It also discussed ways to upgrade services offered to customers through fast, accurate, and easy-to-use digital platforms. The FTA board of directors also examined the progress made on developing the draft corporate tax law.
FTA services upgrade
Sheikh Maktoum issued directives to maintain the pace of upgrades made to the FTA’s services, in line with international best practices and digital transformation plans, which were developed to boost the UAE’s competitive edge in terms of services provided. It will support the country’s vision to become the world’s highest-ranking government on trust and performance indicators.
“The directives aim at focusing on the customer and enhancing competencies to become a world leader in government services, drawing on the UAE’s ‘Principles of the 50’ and the terms of the new methodology for government action,” according to Dubai Media Office statement.
The reports, presented during the meeting, demonstrate the FTA’s efforts to maintain high performance scores across all activities. Sheikh Maktoum noted the authority’s plans to elevate its services to ensure satisfaction for all clients from all segments of society.
“The Federal Tax Authority is committed to strengthening its relations with all entities involved in implementing the tax system in the government and private sectors, and to fulfilling its role in driving nationwide economic diversification policies through the administration and collection of federal taxes, in line with best practices,” he said.
“The authority is constantly reviewing the executive regulations it issues for each tax legislation in order to ensure top-level performance and streamlined procedures. The stages ahead will witness sweeping developments and upgrades to tax systems and procedures in order to enhance the quality of the FTA’s services,” Sheikh Maktoum said.
Atik Munshi, managing partner, FinExpertiza UAE, said the UAE is among one of the lowest tax jurisdictions in the world.
"Considering this aspect alone, businesses are willing to go the extra mile and are happy to comply. FTA has been very proactive and business friendly in its pronouncement of several clarifications to ensure easy compliance," he said.
"More financial discipline has evolved over the years in the UAE corporates which too requires that the entity is in line with the regulations. With the economy improving, it is expected that FTA will see more registrations," he added.
Excise tax registrants up
It was infoomed to the FTA board that the number of excise tax registrants increased 3.02 per cent to 1,398 in first quarter from 1,357 in the same quarter last year while the number of tax agents has increased to 446 compared to 433, reflecting an increase of three per cent.
The report revealed that the authority approved new applications from UAE citizens to recover VAT they incurred on building their new residences; the value of refunds reached Dh185,038,134 during the first quarter of 2022 compared to Dh118,503,245 in the same quarter of 2021, showing a record growth of 56.15 per cent.
The significant increase reflects the FTA’s commitment to streamlining online procedures for UAE citizens looking to recover VAT they incurred on building their new residences, in line with the leadership’s vision to develop a modern housing system for citizens and ensure their wellbeing, given that they are the main objective and beneficiaries from the initiatives and projects implemented by all state institutions.
Furthermore, the report noted the results of implementation of two phases of the ‘Marking Tobacco and Tobacco Products Scheme’, which aims to halt the sale or possession of all types of cigarettes, waterpipe tobacco (Mu’assel), and electrically heated cigarettes that do not carry the Digital Tax Stamps in local markets.
Brent crude and US West Texas Intermediate (WTI) prices slid to eight-month lows on Monday, last trading around $85 and $78, respectively
While global growth this year was still expected at three per cent, it is now projected to slow to 2.2 per cent in 2023, revised down from a forecast in June of 2.8 per cent
In the OECD guidelines, five TP methods have been proposed to assess the arm-length price, which can be categorised into traditional transaction methods, and transactional profit methods
Adnoc to provide liquefied natural gas to the country by late 2022 as part of agreement
On offer is about 550.7 million shares, representing 11 per cent of the company, according to the issued prospectus.