When it comes to combating the overall economic impact of COVID-19 in the UAE (United Arab Emirates), the Government has taken several pro-active measures in recent times. The Federal Government in the UAE has already announced various precautionary measures for the country along with several initiatives that have already been implemented by individual Emirates such as Dubai and Abu Dhabi for helping their particular regions.
The Government has already issued Cabinet Resolution 17 for 2020 with a view towards making it obligatory for all companies and individuals to follow guidelines relating to preventive measures and health as has already been issued by regulatory bodies for preventing the spread of COVID-19. People not adhering to these guidelines will be subjected to various criminal charges/penalties covering fines or imprisonment upon the decisions taken by the country’s Attorney General. The Government has also issued a series of relaxations and grants for companies and small-scale industries in the country.
Learning more about relaxations in taxes for companies
The Government has already taken a few measures with regard to making things easier for businesses during the ongoing COVID-19 pandemic. The UAE does not directly impose income tax or corporate tax on individuals or companies. However, indirect taxes have been introduced sometime earlier on UAE residents. VAT (value added tax) is one of the major indirect taxes along with other customs duties. The Government in Dubai has issued guidelines and regulations for refunding 20% in customs duties upon imports of items that are sold within the UAE. Additionally, it has done away with the obligatory submissions of bank guarantees for clearances of goods in case of customs brokers. It has also directed refunds for prevailing guarantees for such organizations.
The Government of Sharjah has also provided exemptions for shipping clearance organizations for submissions of bank guarantees for executing operations from the 1st of April, 2020. The Federal Tax Authority has already reported expansion of a month for the time-frame for assessment of changes in excise charges. The period from 1st March, 2020, has been extended till the 30th of April, 2020 and this ensures coverage for both April and March. This enables enrolled companies to get more time to adhere to commitments regarding assessment prior to the cutoff timeline. The Federal Tax Authority has also provided a month’s extension for submission of tax returns on a quarterly or monthly basis.
The UAE Government does not have any other taxes imposed on individuals or companies. Along with relief in the form of taxes, the central bank in the UAE has also notified additional benefits for medium and small enterprises and these include zero interest rate loans, lower rates of interest on loans for real estate and lower bank charges/fees for obtaining credit cards. In Dubai, residents are eligible for reductions of 50% in municipality charges/fees which are payable by the hospitality and hotel sector along with reductions for DEWA bills and lower government charges in other categories.
The UAE Government has been going all out to support smaller enterprises, laborers, investors and other residents of the country with regard to announcing new regulations that can help in combating the widespread economic effect of the corona-virus pandemic. For help with VAT registration, company incorporation, VAT auditing and accounting among other essential procedures, GCC Filings is where you can reach out.