The UAE Ministry of Finance (MoF) is seeking input from businesses regarding the implementation of a global minimum tax (GMT) within the country. This consultation is open to all interested parties, with a specific emphasis on engaging multinational corporations operating in the UAE, along with their advisors, service providers, and investors.
The MoF aims to ensure that the implementation of the global minimum tax aligns with the requirements and realities of the business climate in the UAE by actively seeking input from a wide range of stakeholders
The worldwide minimum tax structure is now being examined in depth by the Ministry of Finance (MoF). This involves studying concepts such as the income inclusion rule (IIR), the undertaxed profits rule (UTPR), and the domestic minimum top-up tax (DMTT). Through this effort, the MoF demonstrates its commitment to understanding global tax standards and their potential implications for the UAE’s tax system. This thorough examination assists the MoF in making informed decisions about navigating the complexities of international taxation and ensuring that the UAE’s tax policies stay aligned with global standards.
The new tax rule could also affect the UAE’s plans to rely less on oil money and diversify its economy. It’s part of a global effort to make sure everyone pays their fair share of taxes.
According to the Ministry of Finance’s guidelines, multinational enterprises (MNEs) with annual consolidated revenue of €750 million or more are subject to the global minimum tax (GMT). This requirement guarantees that these MNEs pay a minimum tax rate of 15 on the surplus profits they earn in each jurisdiction where they operate. This rule is governed by two interconnected regulations: the Inclusive Framework’s Inclusive Implementation Rules (IIR) and the Undertaxed Payment Rules (UTPR). Together, these regulations form the global anti-base erosion rules or GloBE Rules.
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