Ministry of Finance Honours Partners in the Economic Substance Project
19 November 2024
The Ministry of Finance today held a distinguished ceremony in Abu Dhabi to honour its partners for their invaluable contributions to the Economic Substance Project.
This recognition reflects the Ministry's appreciation of their crucial role in advancing the project’s objectives, which have strengthened the UAE's commitment to international standards of tax transparency, fair taxation, and comprehensive compliance with tax policies.
The event also served to reinforce institutional collaboration with key stakeholders.
The ceremony was attended by His Excellency Younis Haji AlKhoori, Undersecretary of the Ministry of Finance; His Excellency Khalid Ali Al Bustani, Director General of the Federal Tax Authority; Ali Abdullah Sharafi, Acting Assistant Undersecretary for International Financial Relations Sector at the Ministry of Finance; Fatima Yousif Al Naqbi, Acting Assistant Undersecretary for the Support Services Sector at the Ministry of Finance; H.E. Safeya Hashem Al Safi, Acting Assistant Undersecretary for the Commercial Control and Governance Sector at the Ministry of Economy; and Shabana Begum, Executive Director of the Tax Policy Sector at the Ministry of Finance.
Honoured Partners
The list of honoured partners included the Ministry of Economy, the Central Bank of the UAE, the Securities and Commodities Authority, the Federal Tax Authority, Abu Dhabi Global Market, Masdar City, Dubai Integrated Economic Zones Authority, Dubai Healthcare City Authority, Dubai International Financial Centre, Jebel Ali Free Zone (JAFZA), Dubai Development Authority, Dubai Multi Commodities Centre, Sharjah Airport International Free Zone Authority, Hamriyah Free Zone Authority, Ras Al Khaimah International Corporate Centre, Ras Al Khaimah Economic Zone (RAKEZ), and Fujairah Free Zone Authority.
Commitment to Transparency
In his speech, His Excellency Younis Haji AlKhoori remarked: “This celebration is a testament to our fruitful collaboration and collective efforts, which have established standards underscoring the UAE’s commitment to the highest levels of global transparency and adherence to international obligations. “
He added, ”This distinguished achievement reflects the country’s pioneering approach in economic substance activities. The aim of implementing these requirements was to align with international standards set by the OECD and the European Union, marking a critical step towards greater transparency and solidifying the UAE’s esteemed global reputation.”
A Robust Framework
His Excellency outlined the strategic measures implemented, such as introducing economic substance regulations, strengthening international cooperation with the OECD and the European Union, and collaborating continuously with local partners to keep these regulations up to date.
The Ministry provided thorough guidelines to help companies comply effectively, which has earned the UAE international acclaim for its commitment to the highest global tax standards.
He emphasised that this work continues following the Federal Decree-Law on Corporate Tax, which abolished the requirement to submit economic substance reports for periods ending after 31 December 2022.
This ensured all reports for previous periods were thoroughly reviewed.
Pioneering Compliance
“Our continuous pursuit of excellence required the creation of an integrated system to maintain compliance with the most rigorous international standards,” His Excellency stated.
He further explained, “With a comprehensive legislative framework in place, we prioritised boosting the efficiency of implementation. The UAE has built a robust compliance and enforcement structure and launched a dedicated electronic reporting system, developed in record time despite the challenges presented by the COVID-19 pandemic.”
A Global Benchmark
His Excellency underscored the establishment of the National Committee for Economic Substance, designed to ensure sound governance and drive continuous performance enhancements.
The Ministry of Finance has also made extensive training resources available on its website, including a specialised e-learning platform to support companies in understanding and efficiently meeting regulatory requirements.
These initiatives have created a highly effective monitoring system in the UAE, operating independently of international recommendations. As a result, the UAE's global standing has been elevated, with the nation successfully passing annual evaluations conducted by the OECD Forum on Harmful Tax Practices and the European Union.
He concluded by expressing his sincere gratitude to the Federal Tax Authority, all regulatory bodies in the UAE, and the partners for their invaluable contributions, which have collectively led to this remarkable national accomplishment.
Future Achievements
The Ministry of Finance affirms that the contributions of its partners have been fundamental to the success of the Economic Substance Project. The UAE has demonstrated its unique capability to unify stakeholders and work in harmony to achieve shared objectives.
This approach has fostered mutual trust with international partners and delivered tangible benefits, particularly after the issuance of the Federal Decree-Law on Corporate Tax, which eliminated economic substance reporting requirements for periods ending after 31 December 2022.
