2024-10-7 18:30 |
The United Arab Emirates (UAE) has exempted crypto transactions from the country’s 5% value-added tax (VAT).
This exemption is part of an amendment to the Executive Regulation of the Federal Decree Law on VAT.
According to a document released on Oct. 4, the amendment will take effect on Nov. 15, 2024. However, the regulation will also apply retroactively to transactions conducted since Jan. 1, 2018.
With this new rule, all crypto-related transactions, including transfers and conversions, will no longer be subject to VAT in the UAE. As a result, crypto businesses must review past VAT filings to ensure compliance with the updated regulations.
What does this mean for crypto adoption in the UAE?Market observers suggest that this move reflects the UAE’s continued efforts to integrate digital assets into its financial system. By exempting crypto, the country aligns it with other traditional financial services that are already VAT-free.
A recent report by Chainalysis highlighted that the UAE’s crypto adoption rate exceeds the global average. This is likely due to its clear, progressive regulatory stance on digital assets, which has brought certainty to the market.
Abdulla Al Dhaheri, CEO of the Blockchain Center in Abu Dhabi, highlighted the UAE’s commitment to innovation. He stated that the UAE continues to lead the way in blockchain development under visionary leadership.
He further remarked:
“With the elimination of VAT on crypto transfers and conversions, the UAE reinforce their commitment to building a world-leading digital economy, attracting the best talent and investment from around the globe.”
Consequently, the UAE’s proactive approach has attracted many users and positioned the country as a hub for DeFi and broader crypto activities.
Notably, several notable crypto firms have been drawn to the region, seeing it as a strategic gateway to expand into the Middle East. Tether, for instance, recently announced plans to launch a stablecoin pegged to the UAE Dirham. At the same time, crypto firm Ripple secured an in-principle license to operate within the UAE just last week.
The post Tax-free crypto transactions coming to UAE in November to push digital ambition appeared first on CryptoSlate.
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