Cryptocurrency transactions in the United Arab Emirates (UAE) will be exempt from value-added tax (VAT) starting next month, according to accounting giant PricewaterhouseCoopers (PwC).
The accounting giant says the UAE’s Federal Tax Authority (FTA) published amendments earlier this month exempting crypto transfers from VAT charges.
“Additional services are exempt from VAT:
The management of investment funds
Transferring ownership of Virtual Assets, including cryptocurrencies
Converting Virtual Assets.”
According to PwC, the exemption of crypto transactions from VAT is effective from January 1st of 2018.
The amendments exempting crypto transactions from paying VAT come about a month since the UAE’s Securities and Commodities Authority (SCA) and Dubai’s Virtual Assets Regulatory Authority (VARA) inked an agreement seeking to boost the country’s global position in the cryptocurrency industry.
“Under the agreement, the SCA and VARA will set forth rules and procedures for licensing and supervision 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 service the emirate of Dubai require to obtain a license from VARA, and can be registered by default with the SCA to service the wider UAE. VASPs wishing to operate out of any other Emirates, must be licensed by the SCA to do so.
The agreement covers the mechanism for mutual supervision of VASPs, penalty and fine imposition, the exchange of information and statistics, as well as cooperation in employee training and qualification.”
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