UAE’s Real GDP to increase by 5.3% in 2024, According to S&P Global
S&P Global Ratings expects a significant increase in the UAE’s real GDP to 5.3% in 2024, up from 3.4% in 2023.
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This optimistic review is a result of the UAE banks’ exceptional performance in 2023, highlighted by the lower provisioning requirements and higher interest margins, in addition to improved liquidity levels as deposit growth outpaced new loan growth. The report also noted that the outlooks for the banks in the UAE are stable.
The agency attributes this economic momentum to the increase in oil production and the robust contribution of non-oil sectors, with growth expected from the hospitality, real estate, and financial services sectors.
S&P Global Ratings highlights the exceptional performance of some UAE banks, which achieved record profits in 2023. This success is attributed to robust credit growth amid an environment of rising interest rates. The positive economic climate has also led to lower provisioning requirements for new loan losses, further strengthening the banks’ financial results. This indicates a healthy banking sector that is well-positioned to support and benefit from the UAE’s economic growth.
Moreover, the agency predicts a positive track for bank profits, boosted by growth in non-interest income which reflects a surge in business and commercial activities.
S&P Global Ratings anticipates a cut in interest rates by the US Federal Reserve by 100 basis points in the latter half of the year and expects the Central Bank of the UAE to align with this adjustment due to the dirham’s peg to the US dollar. This scenario is seen to sustain banks’ net interest margins due to the higher interest rates, thereby supporting profitability.
The agency also foresees a steady strengthening in retail lending as banks keep penetrating this sector. And the UAE banks’ funding structures are deemed robust with high liquidity levels, as evidenced by the average cash and money market instruments of the top 10 banks reaching 21.8 percent at 2023’s close, and a solid core customer deposit base that grew by approximately 12 percent last year.
Additionally, Standard & Poor’s highlighted that UAE banks remain in a strong position in terms of net foreign assets, which increased to 27.9 % of system-wide domestic loans as of 30th November 2023, from 9.6 % at the end of 2021.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
Compliance with these deadlines is crucial to avoid administrative penalties.
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The UAE’s Federal Tax Authority (FTA) is urging Corporate Taxpayers to adhere to submission deadlines to avoid fines. Specifically, Resident Juridical Persons with licenses issued in May (regardless of the year) must submit their Corporate Tax registration applications by July 31, 2024, in line with Federal Tax Authority Decision No. 3 of 2024.
This decision aligns with the Federal Decree-Law No. 47 of 2022 on the Taxation of Corporations and Businesses and its amendments, effective from March 1, 2024. The FTA stresses the importance of meeting these registration deadlines, which have been communicated through various media channels and direct outreach to registered company owners in the UAE.
Utilizing the EmaraTax Platform
Compliance with these deadlines is crucial to avoid administrative penalties. The deadlines apply to both juridical and natural persons, including Resident and Non-Resident Persons in the UAE. Detailed information on these deadlines and other relevant issuances can be found on the FTA’s official website.
According to the FTA’s Public Clarification, Resident Juridical Persons established or recognized before March 1, 2024, must submit their tax registration applications based on the month their license was issued. Those with expired licenses as of March 1, 2024, should submit their applications based on the original issuance month. For those holding multiple licenses, the earliest issuance date applies.
Administrative penalties for corporate tax violations have been in effect since August 1, 2023. To facilitate the registration process, taxpayers must use the “EmaraTax” digital platform, available 24/7, or seek assistance from accredited tax agents and government service centers.
The FTA has also emphasized the importance of providing accurate information and submitting updated supporting documents correctly with the electronic registration application, noting that registering for Corporate Tax for a juridical person requires uploading various documents, including the commercial license, the Emirates ID card, the passport of the authorized signatory, and proof of authorization for the authorized signatory.
A comprehensive video explaining the registration process through the “EmaraTax” platform is available on the FTA’s website. This platform, designed according to international best practices, aims to streamline the registration journey, submission of periodic returns, and payment of due taxes for all UAE taxpayers.
Chris Dixon, a partner who led the charge, says he has a ‘very long-term horizon’
Americans now think they need at least $1.25 million for retirement, a 20% increase from a year ago, according to a survey by Northwestern Mutual
