Destination UAE: beneficial taxation and clear rules

The UAE is gradually moving away from the oil economy, thanks to an extraordinary strategic plan, in the framework of which tax reforms fit perfectly but are only one ingredient: this is what Donatello Pirlo, managing partner of Statura Group, a professional firm that has been active for years in London and Dubai in assisting international clients in tax and corporate structuring, says.
We caught up with him to understand what is really changing and what opportunities- but also what obligations-are opening up for entrepreneurs, start-ups and investors looking to the Gulf.

But, what are the main tax changes that have occurred in the UAE?
In recent years, the UAE has embarked on a profound transformation in the tax sphere. The most significant change is undoubtedly the introduction of a federal corporate tax, the Corporate Tax, effective June 1, 2023, which hits profits above 375,000 dirhams (about 90,000 euros) at a rate of 9 percent.
This is a real revolution for a country that has historically lacked direct income taxation.
The nation’s leaders have realized that being a mere tax haven no longer pays, is a double-edged sword, and results in marginalization and reprisals.
The new corporate tax is part of a long-term program; it is really the beginning of a journey, not the end.
That is what is winning. Looking at other Gulf countries as well, everyone today sees the Emirates as an example of forward-looking and attractive growth.
The goal is twofold: first, to consolidate economic resilience by diversifying revenue sources beyond the oil sector, and second, to strengthen the country’s competitiveness and attractiveness as a global financial and business hub.

What about for SMEs and start-ups? Are there any special measures planned?
There is the so-called Small Business Relief that works very well, those who invoice less than 3 million dirhams-around 720,000 euros-are not taxed ... so a very strong incentive.

What about individuals?
Individuals are not subject to personal income taxes, so income from employment, personal and real estate investments are exempt from taxation in addition to paying no inheritance or gift taxes. However, if an individual engages in a business with an annual turnover exceeding 1 million dirhams
(about 240,000 euros), he or she is required to register for tax purposes and will be taxed at 9 percent on profits exceeding 375,000 dirhams (about 90,000 euros).

And are the results of this reform already being seen?
Yes, the results have been almost immediate. According to the Henley Private Wealth Migration Report 2024, the UAE has been the country with the highest net inflow of millionaires globally: +6,700 new HNWIs in the past year alone, a trend that is expected to grow strongly in the coming years as well.
Not only that, more and more multinationals are moving their regional or global headquarters to the Emirates or opening new businesses.
This testifies to how well thought-out tax reform, combining transparency, competitiveness and low tax burden, can be a very powerful lever of economic attraction.

In short: the tax is there, but you almost can’t see it!
The Emirates has recognized that a tax-free environment and a reputation as a pure tax haven are not sustainable in the long run.
However, by maintaining a single-digit corporate tax and providing targeted reliefs, the country retains a high level of international competitiveness.
The following have also been introduced: an exemption regime for dividends and capital gains at the corporate level (Participation Exemption); no withholding taxes on dividends and interest paid to nonresidents; and a very extensive network of double taxation treaties: as of February 2025, the Emirates had signed 143 treaties, of which 112 are in force.

But with this new taxation, should we expect controls?
Undoubtedly so. The Emirates is showing that it wants to be fully aligned with international standards not only in legislation but also in its implementation.
From 2023 to 2024, the number of tax inspections more than doubled from 40,000 to over 93,000, essentially on VAT and customs duties. With the introduction of the Corporate Tax, the first real specific inspections are expected to start in early 2026.
In addition, inspectors have been hired from several international jurisdictions, advanced digital platforms for tax compliance are being developed, and a whistleblowing program for tax violations has been activated.
In short, the message is clear: the Emirati tax system will yes be competitive, but based on transparency and compliance.

Mr. Pirlo, in conclusion, how do you see the UAE’s fiscal future?
I see it in line with the country’s strategic development plan: a light but credible taxation, geared toward sustainable growth and international competitiveness. The introduction of the Corporate Tax, marks the beginning of a long-term path that will make the Emirates a model of balance between tax attractiveness and international compliance.
For entrepreneurs, multinationals, and High Net Worth Individuals, this is an extraordinary opportunity, not least because this reform contributes concretely to overcoming the perception of the UAE as a tax haven - a perception that is now outdated, as evidenced by the country’s removal from the European Union’s blacklist in 2019 and, more recently, from the Financial Action Task Force’s list of countries “under observation” in February 2024.
All signs of a jurisdiction that intends to play a leading role in the global economic landscape, with clear, transparent rules consistent with international standards.