DEC discusses draft federal tax laws

A number of draft federal tax laws proposed by the UAE federal government were discussed on Tuesday by the Dubai Economic Council in the presence of representatives of Dubai's economic departments and business leaders of the private sector.

Chairman of the Council Juma Al Majid, who presided over the meeting, underscored the need to listen to all views of concerned departments on the imposition of taxes due to their influence on the national economy.

"Value Added Tax (VAT) and other taxes are among the most important resources along with other fees," Al Majid said.

“Any step towards imposing taxes has to be carefully studied and deliberated. It is not wise to rush to impose them as this would have an impact on Dubai's competitiveness. There is also a need to meet all requirements to implement taxes. These include complete legal frameworks, suitable capabilities to effectively enforce tax laws in line with the international best practices," said Al Majid.

Al Majid also stressed on the need to look at taxing policy as an integral part of the national economy, in terms of the new obligations of the UAE.

"Imposing taxes, if any, should be performed in two stages. First: imposing VAT- which is relatively easier in terms on implementation as is the case in many countries- provided national institutions are prepared for the process in terms of technology, knowledge, human resources and material resources.

“In light of this and after considering the general atmosphere and trends, other taxes mulled by the government can be considered in line with developments. Impact of planned taxes, including those to be imposed on companies, on the national economy should be assessed by studies beforehand," Al Majid added.