Crypto News: How UAE's New Tax Exemption Policy Will Impact the Cryptocurrency Market
How Have Cryptocurrency Regulations in the UAE Changed?
Starting November 15, 2024, the UAE will exempt cryptocurrency transactions and conversions from Value Added Tax (VAT), applicable to both individuals and businesses. This significant shift reflects the UAE's proactive approach to fostering a thriving crypto market.
Previous Tax Regulations
Prior to the tax exemption policy, the UAE had imposed a 5% VAT on cryptocurrency transactions, similar to other commercial transactions. However, this taxation created challenges due to cryptocurrencies' decentralized and anonymous nature. The prior regulations hampered entry into the crypto market.
The New Tax Exemption Policy
The Federal Tax Authority (FTA) of the UAE issued revised VAT regulations on October 2, announcing that cryptocurrency-related transactions, including transfers and conversions, will henceforth be exempt from VAT. This new policy is expected to stimulate growth and investment in the sector.
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