Cryptocurrency transactions in the United Arab Emirates (UAE) will be exempt from value added tax (VAT) from next month, according to accounting giant PricewaterhouseCoopers (PwC).
The accounting giant says the UAE Federal Tax Authority (FTA) published changes earlier this month that exempt crypto transfers from VAT duties.
“Additional services are exempt from VAT:
The management of investment funds
Transfer of ownership of virtual assets, including cryptocurrencies
Convert virtual assets.”
According to PwC, the VAT exemption for crypto transactions applies from January 1, 2018.
The changes that exempt crypto transactions from paying VAT come about a month after the UAE’s Securities and Commodities Authority (SCA) and Dubai’s Virtual Assets Regulatory Authority (VARA) entered into an agreement to strengthen the country’s global position in the cryptocurrency industry.
“Under the agreement, the SCA and VARA will establish rules and procedures for the licensing and supervision of virtual asset service providers (VASPs) and any related activities, services or associated transactions…
The two parties agreed that VASPs operating in/from Dubai or wishing to serve the Emirate of Dubai would require a license from VARA and be standard registered with the SCA to serve the wider UAE. VASPs wishing to operate from another Emirates must be licensed by the SCA to do so.
The agreement covers the mechanism for mutual supervision of VASPs, the imposition of fines and fines, the exchange of information and statistics, as well as cooperation in the field of training and qualification of workers.”
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