UAE Set to Scrap Tax From Monday as New Rules Take Effect

The UAE is set to waive a form of government fee from Monday, with student inventors and people with disabilities to receive exemptions from industrial property fees.

The exemption will cover fees linked to industrial property, in a move aimed at supporting innovation and encouraging greater intellectual freedom.

Industrial property fees are government charges associated with protecting intellectual and industrial property rights, including patents and designs.

The term can also refer to costs related to leasing, registering or managing industrial properties such as warehouses and factories.

The changes are part of Cabinet Resolution No. (136) and will take effect from Monday, September 14.

New rules coming into force

The development comes as the UAE’s Federal Tax Authority (FTA) prepares to introduce another major tax-related rule next month.

From October 1, the FTA will have the authority to deny a VAT refund to a business if it suspects that goods purchased by the company have evaded tax at some point in the supply chain.

Under the new requirements, businesses will need to verify a supplier’s identity when they first begin working with them and repeat the verification every 12 months.

Businesses will also need to watch for potential warning signs when conducting supplier checks, including changes of address, the movement of key staff and transactions that appear unusually large compared with the supplier’s size and scale.

For larger commercial partnerships, UAE businesses dealing with suppliers that provide goods or services worth more than $102,000 (AED 375,000) will need written confirmation from a UAE bank that the supplier maintains an account with the bank.