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The New Global Tax Deal and its Effects

Posted on    20 October 2021
The New Global Tax Deal and its Effects

The Organization for Economic Co-operation and Development  (OECD) and UAE plans to introduce more taxes with the new global tax deal. 

After all major countries including the UAE signed OECD’s global tax deal. The country's fear is that it will impose a company tax of at least 15% across the board. This will also apply to holding trusts and entities' revenue.

Many entrepreneurs and businessmen established intermediate companies in these countries. So that the activities could be managed from there, and they could take advantage of the UAE's tax benefits.

Some of them had even begun forming "fact patterns" in order to avoid getting caught up in tax and regulatory concerns. The goal of these fact patterns, which highlight historical transactions and organisations, is to demonstrate. That the move was made for genuine reasons rather than to save money on taxes.

In the last two years, many Indian families have relocated their holding corporations and trusts to Dubai. The fear now is that the OECD global tax agreement will result in a 15% tax in the UAE.

Countries with no income tax, such as the United Arab Emirates, were chosen for establishing specific holding organisations or trusts.

You can access Law including Guidelines, Cabinet & FTA Decisions, Public Clarifications, Forms, Business Bulletins for all taxes (Vat, Excise, Customs, Corporate Tax, Transfer Pricing) for all GCC Countries in the Law Section of GCC FinTax

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