The OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting (BEPS) and its 108 members tackles tax avoidance by ensuring the implementation of the measures agreed through the BEPS Project, which targets multinational enterprises’ aggressive tax planning practices. In particular, four “minimum standards” are at the core of the BEPS measures: harmful tax practices, treaty abuse, country-by-country reporting and dispute resolution mechanisms.
Both the Global Forum and the Inclusive Framework (as regard its four minimum standards) have put peer reviews in place, a process through which all members are assessing each other’s implementation of the agreed standards. While the Global Forum process has been in place since 2010 for exchange of information on request and has produced comprehensive ratings, the review of the implementation of the BEPS minimum standards and the implementation of AEOI is more recent and so the results of evaluations and recommendations for improvement are in an earlier stage.
In line with its commitment to international standards, the G20 and the Organization for Economic Co-operation and Development (OECD) initiative on Base Erosion and Profit Shifting (BEPS), the UAE has joined the Inclusive Framework on the BEPS program to become the 116th jurisdiction to join this framework.
This announcement came as a result of efforts made by the Ministry of Finance (MoF) in cooperation with relevant entities in federal and local government to implement the best international standards to reduce tax erosion and work more closely with international peer groups. This reflects the vision of the country’s wise leadership and the intelligent decisions of the Cabinet in their efforts to establish the UAE in a leading global position across a number of nationally important fields.
HE Younis Haji Al Khoori, Undersecretary of MoF, said: “The joining of the UAE to the Inclusive Framework of BEPS is a new recognition of the UAE’s pioneering role in building a sophisticated and efficient tax network.
The UAE will further strengthen its efforts to work with its counterparts in the European Union and OECD member states to ensure that international standards for base erosion and profit sharing are implemented, as well as develop further standards to address issues. Being part of the IF, UAE commits to implementing the minimum standards and coordinating with experts from the Organisation to amend and review tax agreements concluded by the country, to meet the minimum requirements.”
UAE Overview
| Exchange of information on request (EOIR) | |
| Global Forum Member | Yes |
| EOIR rating round 1 | Prov. largely compliant |
| EOIR rating round 2 | Scheduled 2018 |
| Automatic exchange of information (AEOI) | |
| Mutual Administrative Assistance Convention | Signed |
| Commitment to AEOI (CRS) | 2017/2018 |
| CRS MCAA signed | Yes |
| BEPS | |
| Inclusive Framework on BEPS member | Yes |
| Existence of any harmful tax practices (Action 5) | — |
| Exchange of information on tax rulings (Action 5) | — |
| Preventing treaty abuse (Action 6) | — |
| CbC – Domestic law (Action 13) | — |
| CbC – Information exchange network (Action 13) | — |
| Effective dispute resolution (Action 14) | — |
Get in touch
Kelmer office in Dubai remains available for any clarification, regarding the UAE tax system and the new VAT law. Our team of experienced consultants, legal experts, and tax accountants will ensure timely and cost-effective VAT services for SMEs.
You can reach us at
Telephone: +971 (0)4 432 7598
Email: dubai@.kelmer.com