UAE authorities abolish VAT on transfers and conversion of cryptocurrencies
Crypto companies registered in the country will be able to reimburse previously paid taxes
07.10.2024 - 13:30
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What’s new? The UAE’s Federal Tax Authority (FTA) has published amendments to the value-added tax (VAT) rules. According to the Big Four consulting firm PwC, value-added services such as investment fund management and the transfer or conversion of virtual assets are exempt from VAT. Moreover, the rule applies to the latter two retrospectively, from January 1, 2018.
What else is known? Thus, crypto companies can apply for a refund of previously paid taxes, PwC notes. To do this, the firm must have registration in the country and provide reporting.
Despite significant easing in tax policy, in general, supervision of the sector in the country has been strengthened. Thus, on September 26, the Dubai Virtual Assets Regulatory Authority (VARA) introduced new rules regarding the promotion of cryptocurrency services, according to which providers are required to place a clearly readable disclaimer about the risks of crypto investment.
Meanwhile, back on September 9, VARA and the Securities and Commodities Authority (SCA), the UAE’s federal financial agency, agreed to mutually supervise virtual asset service providers (VASPs). Thanks to the agreement, crypto firms operating in Dubai after obtaining a license VARA will be able to operate throughout the country, by default receiving and registration with SCA.
Earlier, it became known that the Turkish authorities refused to introduce a tax on crypto trading from 2025. The proposal was removed from the agenda for the near future.
In early September, the Financial Services Agency of Japan (FSA) proposed to reduce the tax rate on crypto income. Representatives of the industry have repeatedly appealed to the government with requests to do so.
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