Emirates News Agency – Ministry of Finance announces changes to Excise Duty Law

ABU DHABI, 18th October, 2022 (WAM) — The UAE Ministry of Finance has unveiled amendments to certain provisions of Federal Executive Order No. 7 of 2017 on Excise Tax, effective from 14th October 2022 .

Amendments to certain provisions of the law aim to support the business sector, facilitate compliance by taxable persons, minimize tax evasion and address challenges related to the application of excise duty.

Federal Executive Order No. 19 of 2022 amending certain provisions of Federal Executive Order No. 7 of 2017 on Excise Tax includes the following new amendments:

1. Persons who import excise goods for purposes other than the exercise of a commercial activity shall be exempt from tax registration, while remaining liable for the excise duty corresponding to the importation. A further amendment to the same article requires that the application for exemption from tax registration be submitted before the import activity and not at the time the tax is due.

2. A new clause has been added confirming that anyone who receives an amount as tax or issues an invoice reflecting the tax, must pay that amount to the Federal Revenue Authority (FTA), and the amount must be processed with the same treatment as that determined for the due date. tax. Consequently, a taxable person must pay the sums he collects as tax to the AFC, even in cases where the tax has been applied by mistake or by evasion.

Provisions relating to the limitation period for tax audits, tax assessments and time limits for submitting a voluntary declaration have been added. The statute of limitations sets the maximum period within which the ALE – which is responsible for the application of the excise tax – may act. Once this period has expired, the AFC is generally prevented from acting. As a general rule, the AFC cannot carry out a tax audit or issue a tax notice to a taxable person after the expiry of a period of 5 years from the end of the tax period concerned. In accordance with the provisions, there are exceptions to this general rule.

The new Federal Decree-Law includes further changes. In accordance with the decree, the amendments come into force on October 14, 2022.

Further information is available via the following link Tax Legislation – Ministry of Finance – United Arab Emirates (mof.gov.ae).

Amjad Saleh / HATEM MOHAMED

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