“The Ministry of Finance is very keen to expand its network of international relations by signing agreements to avoid double taxation and agreements to protect and promote investment,” Khoori said. To implement the BEPS measures, the United Arab Emirates has signed a multilateral instrument that facilitates the modification of its existing treaties. “It allows the UAE to change all tax treaties through an agreement,” says Khan of the law firm Al Tamimi. The United Arab Emirates has 100 double taxation agreements with most of its trading partners. There are 21 outstanding double taxation agreements, 12 signed but not yet ratified and nine currently under negotiation. The VaE signed an agreement with Saudi Arabia last May, the first in the GCC. Among the countries under negotiation are Australia, Peru and Nepal. Foreign investors should be aware that taxes paid in Dubai may be charged in the foreign company`s country of origin as a credit to the tax paid in the United Arab Emirates, depending on the provisions of the Double Taxation Convention and applicable legislation in the country of origin. Our Dubai lawyers can provide you with specific information on the provisions of each double taxation agreement if you wish to learn more about the actual agreement between Dubai and your country. At the end of the day, it is a political process. Both countries have a double taxation convention, but sometimes it is not easy to share the cake.
For a country with very low taxes, the United Arab Emirates has a vast network of double taxation conventions. With agreements in 90 countries – and 33 in progress – the UAE has more double taxation conventions than countries such as Ireland, Luxembourg and Singapore. “I hope that next week we can sign some (of these agreements) and that we will soon see tourists and businessmen visiting both countries and visiting the streets of Abu Dhabi and the beach, as well as in Jerusalem, our capital, the beaches of Tel Aviv and throughout the State of Israel.” Of the 90 tax treaties in force, 42 are in Europe, 23 in Asia, 13 in Africa, 4 in the Middle East, two in South America, two in Central America, two in Oceania and one in North America and one in North America and the Caribbean. The treaty with Russia is a state agreement on investment income tax, which means that it applies only to the profits of dividends, interest and capital gains of governments and their financial or investment institutions.