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Tax Alert - Federal Tax Authority

VAT Alert - Federal Tax Authority

A Federal Tax Authority is to be formed under federal law 13 of 2016.



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What’s in the law?

In a significant development, the President of the UAE, His Highness Sheikh Khalifa bin Zayed Al Nahyan, issued federal law 13 of 2016 on 24 October, establishing a Federal Tax Authority (FTA) to govern federal taxes (including VAT) in the UAE. This underlines the intention of the federal government to implement VAT in the UAE by January 2018 and to align UAE laws with international tax developments such as tax treaties, tax information exchange agreements (TIEAs), and global tax information exchange programs (such as FATCA and CRS).


The FTA will:

  • Be a specialized body, aligned with international leading practice, which formulates federal tax rules and regulations, including VAT, and oversees the application of international tax obligations 
  • Be responsible for implementing all aspects of tax laws, including registrations, assessments, evaluations of returns, audits, and the resolutions of disputes
  • Coordinate with governments and taxpayers on tax-related issues
  • Represent the UAE at regional and international meetings and conferences concerning tax matters

KPMG will analyze the decree in depth once it is published in the Official Gazette. Law 13 of 2016 is expected to come into effect in January 2017.  


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