The United Arab Emirates (UAE), Saudi Arabia, Qatar, and Bahrain have made a significant mark on the global business landscape by securing spots in the top 10 countries with the most favorable tax environment.
This ranking was recently released by US News Best Countries rankings and Open for Business sub-ranking, which evaluated corporate tax rates, ease of filing taxes, and overall tax burden on businesses.
UAE has secured the third spot on the list with a zero percent corporate tax rate, making it an attractive destination for foreign companies. Saudi Arabia has also been working on improving its tax environment, which helped it secure the sixth position.
Similarly, Qatar and Bahrain have also taken steps to streamline their tax systems and create a favorable business environment. Qatar secured the seventh position on the list, and Bahrain booked the eighth position.
The top 10 list of countries with the most favorable tax environment is as follows:
The inclusion of four Gulf countries in the top 10 list is a major feat for the region. It reflects their dedication to developing a business-friendly environment for local and foreign investors, encouraging economic growth, and generating job opportunities.
UAE to Introduce Corporate Tax
UAE’s Ministry of Finance (MoF) has made a significant announcement, revealing that it will introduce federal corporate tax (CT) on the net profits of businesses. The tax will be enforced across the country and will be applicable from either 1 July 2023 or 1 January 2024, depending on the fiscal year of the company.
This was announced in January last year and is expected to have far-reaching implications for businesses operating in UAE. It remains to be seen how it will affect UAE’s favorable tax environment in the long run.