The tax system in the United Arab Emirates (UAE) is experiencing rapid development, enhancing its vital role in supporting economic growth, establishing financial sustainability, and achieving a balance between the demands of development and the facilitation of voluntary tax compliance.
The Federal Tax Authority (FTA) is committed to creating a comprehensive tax model that aligns with international best practices, focusing on complete digital transformation, expanding service offerings, and improving the efficiency of legislative and procedural frameworks, thereby solidifying the UAE’s position among the world’s most advanced countries in this field.
Over the past few years, the FTA has successfully built a robust electronic tax system characterized by ease and transparency, which has led to a significant increase in the number of users. Currently, there are over 576,000 registrants for corporate tax, more than 511,000 registrants for value-added tax (VAT), and 1,756 registrants for selective tax.
The authority reported to the Emirates News Agency (WAM) that the number of approved tax agents has risen to 676, which enhances the support provided to taxpayers and broadens engagement within the tax community.
Furthermore, the FTA highlighted its ongoing efforts to keep pace with the expanding customer base by continually improving digital services. The agency received a total of 549,200 inquiries and comments through various communication channels last year, a rise from 355,300 in the previous year. Additionally, the number of visitors to its taxpayer support centers in Abu Dhabi and Dubai reached over 38,110.
The customer satisfaction index at the FTA increased to 91.5% last year, reflecting a 1.5% improvement from the prior year, indicating the effectiveness of the FTA’s approach to simplifying procedures and providing smart services that meet customer expectations.
In line with its innovation initiatives, the FTA launched several notable projects, such as the “Miskan” smart application, which allows citizens to claim a refund on taxes paid for building their new homes, and the “Emirates Tax” app, marking a significant advancement in smart services.
The FTA also introduced the world’s first system for refunding tourists’ taxes on their online purchases while they are in the country, further establishing the UAE as an attractive destination for tourism and shopping.
Regarding the development of the regulatory and legislative framework, the FTA has reviewed and implemented over 600 laws, decisions, and tax memoranda based on comparative studies and international best practices. It has issued approximately 1,830 tax clarifications—1,770 specific clarifications on particular cases and 60 general clarifications—to enhance awareness and increase tax compliance rates, alongside the release and update of 116 guidebooks to simplify and clarify tax procedures.
The FTA promotes the fairness of the tax system by providing independent channels for reviewing requests and disputes, including a review committee and tax dispute resolution committees, to ensure equitable treatment of taxpayers and effective resolution of comments and complaints, all in alignment with principles of transparency and justice.
The response from the business sector towards the tax system has increased significantly, backed by heightened tax awareness and intensified communication efforts by the FTA with all strategic partners.
The FTA holds regular meetings with advisory groups consisting of representatives from both governmental and private sectors, such as the selective tax advisory group, the business advisory group for tax agents, and the VAT advisory group.
These initiatives aim to share insights, understand challenges faced by various business sectors, and participate in the development of policies and procedures, thereby enhancing voluntary compliance and increasing the competitiveness of the nation.
Furthermore, the FTA expanded its awareness efforts significantly, hosting 178 awareness events last year attended by 122,800 participants, which reflects an annual increase of 68.6% compared to 2023. The number of awareness publications on social media reached 4,399, a rise of 231.25%, and its website attracted 2.1 million visitors, including 1.9 million new users.
This comprehensive advancement in the services and regulations of the Federal Tax Authority indicates that the UAE is steadily moving toward establishing a modern and effective tax system that balances financial efficiency and tax fairness, and contributes actively to the country’s goals of economic diversification and financial sustainability, thereby reinforcing its global standing as an attractive hub for investment and business.