UAE to introduce 15% tax on large multinationals

• Increase from current 9%
• Applies to revenues of €750m
• Measure comes in January 1

The UAE is to increase corporate tax on large multinational enterprises (MNEs) to 15 percent from January 1 2025, the Ministry of Finance has announced.

MNEs currently pay 9 percent of their profits in the Emirates.

The domestic minimum top-up tax (DMTT) will apply to multinational enterprises with consolidated global revenues of €750 million ($793 million) or more in at least two of the four financial years immediately preceding the financial year in which the tax applies.

The amendments come a year after the UAE began rolling out a 9 percent business tax, with exemptions for the many free zones across the country.

The Ministry of Finance said this “strategic step reflects the UAE’s commitment to implementing the Organisation for Economic Co-operation and Development’s (OECD) two-pillar solution, aimed at establishing a fair and transparent tax system aligned with global standards”.

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The OECD’s two-pillar reform programme set up a global minimum corporate tax to ensure large MNEs pay a minimum 15 percent tax on profits in each country where they operate.

Bahrain said in September that it would also introduce DMTT starting from January 1 next year on large MNEs.

Kuwait has also announced an incoming corporate tax rate for large MNEs of 15 percent from the beginning of 2025.