Highlights of Digital Public Consultation on Implementation of Global Minimum Tax in UAE
The Ministry of Finance in the UAE took a big step for global tax transparency. The Ministry started a digital public consultation about the Global Minimum Tax (GMT) and the Global Anti-Base Erosion Model Rules (GloBE Rules). The government wanted everyone—businesses, tax experts, and regular people—to give feedback about new tax rules. This effort shows how the UAE wants to match world standards, stay fair, and support strong economic growth.
Why Is the Global Minimum Tax Important in UAE?
The Global Minimum Tax is important for the UAE because it helps keep the country honest with taxes. The rules help stop companies from moving money to avoid paying tax. By having the right tax rules, the UAE makes sure all companies pay their fair share.
Some benefits of a global minimum tax include:
- The UAE gets more respect as a financial center.
- Investors feel safer about putting money into UAE businesses.
- There is less profit shifting and tax evasion.
- All companies can compete on a fair field.
The UAE uses these new tax rules to boost the whole economy and follow the same rules as other countries.
Digital Public Consultation: Objectives & Outcomes
The Ministry of Finance ran this public consultation online to get feedback from many people. They wanted to understand what businesses, tax professionals, and citizens thought about the new global minimum tax.
The main objectives were:
- Make the process open and fair,
- Learn about the real challenges companies face,
- Hear new ideas about how to set up and apply the new rules,
- Create a strong plan for the new tax system,
- Offer a chance for everyone to share their opinions.
By collecting feedback, the government can make better decisions and avoid surprises. This helps the UAE stay ahead in tax matters.
Who Could Take Part?
- Multinational companies,
- Tax advisors and consultants,
- Investors,
- Companies in free zones,
- Anyone who wanted to share their opinion.
Everyone was welcome to join and help shape the new tax policies.
Key Proposals and Rules in the UAE’s Global Minimum Tax
Here are some highlights of the rules and proposals for the global minimum tax in the UAE:
- Applicability: All large multinational businesses, including those in free zones, will need to follow the GloBE rules.
- Free Zone Incentives: Free zone businesses might get extra tax breaks, but only if those fit with the new global rules.
- Who’s Exempt? Some small businesses and domestic-only groups will not be affected.
- Threshold: Only companies with over €750 million in global revenue must follow the GloBE rules.
- Financial Reporting: Companies must use IFRS standards to report their income or loss. This matches current UAE corporate tax laws.
- Filing Demands: Companies will need to file a GloBE Information Return with the Federal Tax Authority (FTA). The first report is due 18 months after the rules start. After that, reports are due 15 months after each fiscal year-end.
- Tax Returns Options: The government suggested two options:
- File two returns (one for GloBE and one for domestic minimum top-up tax).
- File one combined return for both taxes.
- Payment Schedule: Taxes might be paid on the same dates as corporate tax, or on a separate schedule.
Other Key Points
- The Ministry also asked about incentives for businesses that invest in the UAE and create real value.
- The new system follows the OECD’s GloBE Model Rules, so it matches international rules.
- The UAE government wants rules that don’t chase away businesses, but also make sure tax is paid fairly.
Bullet Points: Main Takeaways
- UAE wants to match international tax rules.
- Only big multinational businesses must follow the new GMT rules.
- Free zone companies could keep tax breaks if they follow global rules.
- Reports must follow international standards (IFRS).
- Companies must file new returns with the FTA.
What Can Help? – Mubarak Al Ketbi (MAK) Auditing
Mubarak Al Ketbi (MAK) Auditing is ready to guide your business through all the new tax rules in the UAE. We help businesses by:
- Giving up-to-date tax advice,
- Helping with tax registration and return filing,
- Explaining what the new rules mean for your company,
- Providing custom plans so you always stay compliant,
- Saving your business from costly mistakes,
- Making sure your company “stays ahead of the curve.”
For more information:
- Visit our office: Saraya Avenue Building – Office M-06, Block/A, Al Garhoud – Dubai – United Arab Emirates
- Contact/WhatsApp: +971 50 276 2132
