IMF: The UAE Must Continue the Fiscal Consolidation

Updated on Sunday 12th November 2017

IMF: The UAE Must Continue the Fiscal Consolidation Image
Considering the IMF (International Monetary Fund) recommendations, the countries part of the Gulf Cooperation Council have announced that new measures will consolidate the fiscal sector. Among these, the UAE is ready to implement their reforms in the non-oil revenues and capital expenditures, as part of the VAT (in 2018) and excise tax introduction. The new taxation system can be explained by our accountants in Dubai who can also perform audits for your company in Dubai.

How the fiscal consolidation strategies will be adopted

First of all, the government must improve the fiscal frameworks in a continuous manner. Even though in the UAE important progress has been registered in the medium-term budgetary frameworks and the macro-fiscal units, the IMF considers that these measures should be constantly overseen and tailored as soon as the taxation system changes. Additionally, firming up the financial management, refining the accountability and the transparency can be part of the fiscal consolidation suggested by the IMF for the UAE. Having quarterly fiscal reports will lead to the needed transparency and will help companies understand how the new tax laws will be adopted and imposed.

In regards to the new regulation for 2018, our Dubai accountants can offer complete support for companies and businesses interested in aligning with the new requirements. Also, our team can perform audits in Dubai for each type of company, whether small, medium or large.

What other recommendations does IFM want for the UAE?

The International Monetary Fund is expecting GCC countries to suitably implement the new taxation system. Moreover, the same institution considers that the UAE should pay attention to the credits in the private sector and the limited capacity of the domestic financial market. In this matter, better confidence on the domestic financing might reduce the values of a decline in the international market environments. The UAE fiscal consolidation projects for the years to come should focus on supplementary cuts in capital expenditure and non-wage frequent expenses. Higher non-oil incomes are expected for 2018 with the introduction of the VAT and the excise tax.

For a proper understanding of the taxation system in Dubai and the new rules which are going to be imposed for each company in Dubai, please feel free to contact our accounting firm in Dubai.

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