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On October 2, the UAE Federal Tax Authority (FTA) announced key amendments to its VAT framework, following Cabinet Decision No. (100) of 2024.
These changes, which come into effect on November 15, provide clarity on the tax treatment of virtual assets, tokens, and blockchain-based transactions.
“The US needs to follow if they want to be competitive." crypto analyst Borovik wrote in an October 6 social media post on X.
For the first time, the amendments formally address the VAT treatment of virtual assets, such as cryptocurrencies and digital tokens, by exempting certain transactions from the existing 5% levy. This includes the management of investment funds and the transfer and conversion of virtual assets, with the exemption retroactively effective from January 1, 2018.
These amendments signal the UAE’s effort to remain a global leader in fostering innovation within the digital asset industry while safeguarding the interests of both businesses and consumers.
A key highlight of the FTA’s amendment is the formal definition of "Virtual Assets." According to the new law, virtual assets are now recognized as digital representations of value that can be traded, transferred, or used for investment purposes.
A Financial Times report indicates that valuation in the private assets market continues to pose significant challenges due to the inherent complexities of these investments. Factors such as the opaque nature of some assets, less frequent pricing, and reliance on subjective estimates can complicate accurate valuation.
The Chartered Alternative Investment Analyst Association (CAIA) is actively advocating for enhanced valuation methodologies in the alternative investments sector.
The Federal Tax Authority (FTA) is the government entity responsible for administering, collecting, and enforcing federal taxes in the United Arab Emirates.
The UK cryptocurrency market continues to pose challenges for exchanges as they adapt to stricter regulatory requirements. Cryptocurrency exchange Bitget recently relaunched its UK platform after halting services in May 2024 to comply with the UK Financial Conduct Authority’s (FCA) Financial Promotions regime. This relaunch reflects Bitget’s efforts to align with the FCA’s evolving standards, aimed at enhancing consumer protection in the digital asset space.
The Italian government recently announced a plan to increase the capital gains tax on bitcoin and other cryptocurrencies from 26% to 42%. This proposal, part of broader fiscal measures to support election pledges and reduce Italy’s fiscal deficit, has raised concerns among cryptocurrency investors and industry leaders.
On November 14, the European Banking Authority (EBA) released comprehensive guidelines for Payment Service Providers (PSPs) and Crypto-Asset Service Providers (CASPs) to ensure alignment with European Union (EU) and national restrictive measures. These guidelines aim to reduce risks and strengthen compliance when transferring funds or crypto assets.
The UK government is set to introduce new cryptocurrency regulations aimed at countering the growing appeal of the United States as a destination for crypto businesses. In response to concerns of regulatory delays following Brexit, the legislation focuses on establishing a clearer framework for stablecoins and staking activities, with the goal of strengthening the UK’s position as a global hub for digital assets.
OpenAI, the world’s largest artificial intelligence company, has announced it will establish a new base in Paris.
On October 30, UK Chancellor Rachel Reeves announced a capital gains tax (CGT) rate increase for high-income individuals, raising it to 24%. This change has raised concerns in the cryptocurrency community, where some investors fear that increased tax and regulatory pressures will diminish the UK's appeal for digital asset investment.
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