Federal Tax Authority’s Board of Directors Adopts Budget for 2019
The Federal Tax Authority’s (FTA) Board of Directors held its sixth meeting, chaired by His Highness Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, Minister of Finance, held at the headquarters of the UAE Ministry of Finance on Monday (October 29, 2018).
During the meeting, the Board discussed a detailed report outlining the FTA’s achievements over the past period, as well as the latest developments with regards to the Authority’s activities, the registration process for Value Added Tax (VAT) and Excise Tax, import declarations, Tax Returns on Excise Tax and VAT, and audit procedures. The report revealed a high rate of tax compliance in the UAE.
Furthermore, the Board adopted the FTA’s proposed budget for 2019, in addition to a number of executive decisions regarding the Authority’s internal regulations, policies and operations.
They went on to examine the procedures currently underway to build the technological infrastructure for phase one of the Tax Refund for Tourists Scheme, which goes into effect on November 18, 2018, at airports in Abu Dhabi, Dubai, and Sharjah. This included an overview of the preparations by the operator to set up tax reimbursement offices in the three airports, and to electronically link the system with the FTA network and participating retail outlets, which are set to reach 4,000 across the country.
Furthermore, the FTA Board of Directors touched upon the subject of the Digital Tax Stamp Scheme for Tobacco, which goes into effect on January 1, 2019, affecting, in the first stage of implementation, imported, locally produced and locally distributed cigarettes, before being gradually expanded to include all locally distributed tobacco products.
H.H. Sheikh Hamdan bin Rashid Al Maktoum commended the Authority for the continued progress of its systems, asserting that the FTA has successfully strengthened its partnership with the private sector, providing all necessary facilities to ensure self-compliance with tax regulations in a seamless manner supporting economic activities.
“The outstanding results that the Federal Tax Authority achieved demonstrate that it has succeeded in implementing a world-class, advanced tax system,” H.H. said. “We have seen good and promising compliance rates among registered businesses, reflecting the great tax awareness that the FTA campaigns and introductory programmes conducted across all seven emirates have managed to achieve.”
“The few remaining months of 2018 and the coming year will witness great transformations with new mechanisms being launched, such as phase one of the Tax Refund for Tourists Scheme, which will be launched next month and become fully operational before the end of the year with an integrated digital infrastructure connecting stores, retail outlets, airports, land and sea ports. This, in turn, promotes the UAE’s status as a leading destination on the international tourism map,” H.H. Sheikh Hamdan bin Rashid added.
H.H. concluded by revealing that 2019 will witness the implementation of the Digital Tax Stamp Scheme for Tobacco, which will establish accurate and effective controls to support the Authority’s efforts in collecting tax and combatting tax evasion.
Federal Tax Authority
By virtue of this Federal Law by Decree a public federal authority shall be established under the name of the Federal Tax Authority. The headquarters of the authority shall be located in the city of Abu Dhabi. The authority shall be in charge of managing and collecting federal taxes and related fines, distributing tax-generated revenues and applying the tax-related procedures in force in the UAE.
The authority shall be managed by a board of directors chaired by the Minister of Finance and a sufficient number of members to be appointed and remunerated by a Cabinet resolution, based on the chairman’s nomination. The authority shall have an independent annual budget that shall be deemed as public funds and exempted from all taxes and fees.
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