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The Ministry of Finance of the United Arab Emirates has implemented a series of modifications to tax regulations, exempting specific cryptocurrency transactions from value added tax (VAT).
The UAE Cabinet has sanctioned a resolution to revise the Executive Regulation of Federal Decree-Law No. 8 of 2017 concerning value added tax (VAT). As reported by local media, the Federal Tax Authority (FTA) has exempted certain transactions involving digital assets from taxation.
The modifications pertain to:
- the transfer of ownership of virtual assets, including cryptocurrencies;
- the conversion of virtual assets;
- the management of investment funds.
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These categories of transactions will no longer incur VAT. Importantly, the new regulations will be applied retroactively to transactions conducted from January 1, 2018, allowing taxpayers to adjust for prior periods. Consequently, cryptocurrency companies will review their past tax filings and seek refunds for the previous six years.
In the UAE, virtual assets are characterized as a digital representation of value that can be exchanged or converted and utilized for investment purposes. However, these transactions must occur without the involvement of fiat currencies and securities.
Younis Haji Al Khoori, Undersecretary of the Ministry of Finance, stated that the primary aim of the tax law amendments is to foster the growth of the investment management sector and enhance the UAE’s appeal as a prominent investment destination.
The UAE authorities are actively refining the regulatory framework for the digital asset industry. A recent cooperation agreement was established between Dubai’s Virtual Assets Regulatory Authority (VARA) and the Securities and Commodities Authority (SCA) to develop a unified licensing system for virtual asset service providers (VASP). Additionally, the Central Bank of the United Arab Emirates (CBUAE) has approved regulations for the issuance of stablecoins in the region and updated requirements for licensed financial institutions (LFI) engaging with VASPs.
Сообщение UAE Authorities Exempt Crypto Companies from VAT появились сначала на CoinsPaid Media.
