Global Minimum Tax Implementation in the UAE

This technical report outlines the introduction of the global minimum tax (GMT) in the UAE, effective from January 1, 2025, as part of the BEPS Inclusive Framework. The UAE's Ministry of Finance has announced a 15% domestic minimum top-up tax (DMTT) applicable to large multinational enterprises (MNEs). The report details the Cabinet Decision 142 and the accompanying DMTT Rules, which provide comprehensive legislation regarding the DMTT, including provisions for compliance, penalties, and record-keeping. It specifies the entities covered by the DMTT, exemptions, and reliefs available, such as the De-Minimis Exclusion and Simplified Calculation Relief. The report also discusses the implications of these tax reforms for MNEs operating in the UAE, including the impact on tax costs and compliance requirements. Furthermore, it highlights the alignment of the DMTT Rules with the OECD's Pillar 2 Model Rules, ensuring consistency with international standards.