Dubai Introduces New Tax Regulation for Foreign Banks
Dubai has unveiled a new tax measure targeting foreign banks within the Emirate.
2 min
Sheikh Mohammed bin Rashid Al Maktoum, the Ruler of Dubai, Vice President, and Prime Minister of the UAE, endorsed Law No. (1) of 2024, focusing on the taxation of foreign banks. This regulation includes all foreign banks active in Dubai, including those within special development zones and free zones. However, it exempts foreign banks that have obtained a license to operate within the Dubai International Financial Centre (DIFC).
Tax Implementation Details
Under the new regulation, foreign banks are now subjected to a tax rate of 20% on their annual taxable earnings. However, if these institutions have already complied with the Federal Law No. (47) of 2022, regarding the Taxation of Corporations and Businesses, including its amendments, such corporate tax payments will be deducted from their total tax due.
The law elaborates on the criteria for determining taxable income and outlines the procedures for tax filings, payments, audits, voluntary disclosures, and the related duties and processes. It also protects the rights of foreign bank branches licensed by the Central Bank of the UAE and outlines the procedure for challenging tax audit findings through Dubai’s Department of Finance, adhering to the stipulated guidelines within the law.
Violations of this law will be met with sanctions and fines as determined by the Chairman of The Executive Council of Dubai, with fines not surpassing AED500,000 ($136,100). In cases of recurrent violations within a two-year span, fines may be doubled, reaching up to AED1m ($272,200). The implementation of this law commences from the tax year succeeding its enactment.
The Director-General of the Department of Finance is assigned the responsibility to make necessary decisions to facilitate the law’s application, to be officially published in the Official Gazette. This law reverses Regulation No. (2) of 1996 and any conflicting regulations, although existing decisions and memos under the 1996 regulation will stay effective until new ones are issued. Effective from its publication date in the Official Gazette, Law No. (1) of 2024 targets the taxation of foreign banks within Dubai.
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Saudi Arabia ranked first among countries for the non-oil exports of national origin with BD201 million (22%)
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Bahrain’s non-oil exports of national origin decreased by 6% to BD894 million ($2.37 billion) in Q2 2024 compared to the same period in 2023. The top 10 countries accounted for 64% of the total export value.
According to the Information & eGovernment Authority (iGA) in its Q2 2024 Foreign Trade report, Saudi Arabia was the leading destination for these exports, totaling BD201 million (22%). The US followed with BD75 million (8.4%), and the UAE with BD73 million (8.2%).
Unwrought aluminum alloys were the top exported product in Q2 2024, amounting to BD267 million (30%), followed by agglomerated iron ores and concentrates alloyed at BD159 million (18%) and non-alloyed aluminum wire at BD49 million (5%).
Non-oil re-exports
Non-oil re-exports increased by 4% to reach BD206 million during Q2 2024, compared to BD198 million for same quarter in 2023. The top 10 countries accounted for 86% of the re-exported value. The UAE ranked first with BD58 million (28%) followed by Saudi Arabia with BD39 million (19%) and UK with BD17 million (8%).
As per the report, turbo-jets worth BD65 million (32%) were the top product re-exported from Bahrain, followed by private cars with BD11 million (5%) and four-wheel drive with BD9 million (4%).
The value of non-oil imports has decreased by 4% reaching to BD1.41 billion in Q2 2024 in comparison with BD1.47 billion for same quarter in 2023. The top 10 countries for imports recorded 68% of the total value of imports.
China Bahrain’s biggest importer
China ranked first for imports to Bahrain, with a total of BD191 million (14%), followed by Brazil with BD157 million (11%) and Australia with BD112 million (8%).
Non-agglomerated iron ores and concentrates were the top product imported to Bahrain worth BD200 million (14%), followed by other aluminum oxide with BD101 million (7%) and parts for aircraft engines with BD41 million (3%).
As for the trade balance, which represents the difference between exports and imports, the deficit logged was BD310 million in Q2 2024 compared to BD322 million in Q2 2023.
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
