As the crypto market in UAE is rapidly blooming, they have recently made some huge changes to the VAT rules. It was made public that the crypto holders no longer needed to make tax payments while trading their assets.
With major Dubai-based companies accepting cryptocurrencies for various services and deals, the UAE government is gearing up for the future of the finance industry by abolishing taxes for all crypto transactions.
UAE abolishes transactional fees on crypto
On October 2nd, the Federal Tax Authority (FTA) of the UAE published Cabinet Decision No. (100) of 2024. It introduced a Value Added Tax (VAT) exemption for transferring and converting various digital assets, which includes cryptocurrency as well.
This was major news for various crypto enthusiasts in the country. With no more tax associated with transferring crypto assets, the trading in UAE is expected to increase by tenfold. Additionally, it was stated that the tax exemptions will be treated as effective from January 1, 2018.
Furthermore, the announcement also states that the taxes paid for crypto transactions by various companies past 2018 can be recovered through legal means.
UAE, a country embracing crypto
When several countries are reluctant to adopt crypto, the UAE is showing the exact opposite of this. In fact, with all the laws and regulations introduced recently, it is clear that the UAE is embracing crypto rather than shying away from it.
The UAE is gradually becoming a key figure in the global crypto market. And, now with this move, they have truly solidified their position in the ever-evolving crypto landscape.
As the crypto market slowly grows, the UAE’s move has attracted the attention of various crypto enthusiasts around the world. Being a crypto-friendly country, that promotes the active use of cryptocurrency, UAE is on the way to becoming one of the top countries in the crypto market.
Will other countries like the US follow suit?
As the next presidential election nears, almost all crypto enthusiasts are wondering the same thing. Will America follow in the footsteps of the UAE in abolishing the crypto tax laws? Well, let’s discuss this and see what the future holds for crypto trading in the US.
The US also like any other country has tax rules regarding cryptocurrencies. This tax rule, demands companies and traders to pay additional fees for every transaction they make. It can be a hindrance to the traders most of the time, due to this very reason.
If by chance, there comes a change in these tax rules, then, the US can definitely solidify its position as a prominent figure in the global crypto economy. As of now, we cannot say with certainty whether the US will adopt this strategy towards cryptocurrency or not. However, there is a chance that the next election may result in the formation of a government that promotes the adoption of cryptocurrency.
As for other countries, we don’t have any conclusive information about whether they will back crypto or not like the UAE. Only time will tell.
Conclusive thought
Recently, the UAE has introduced a series of amendments to the VAT laws of the country. However, the amendment that has garnered the attention of a lot of people was the abolishment of taxes in the trading of virtual assets.
UAE introducing these reforms have made it the center of attraction these days. With many investors and businesses flocking to the UAE, the future of cryptocurrency in the country is looking extremely promising. In the coming years, we will see how different countries will react to this, and whether they will follow suit UAE in adopting crypto or not.
