The tax authorities of the UAE and Kuwait have penned an agreement to end double taxation between the two countries on income and capital gains.
The move is designed to prevent tax evasion and avoidance, according to Kuwait’s minister of finance.
Anwar Ali Al-Mudhaf, who is also minister of state for economic affairs, said the agreement was also part of the process of economic and financial integration and the free movement of capital between the UAE and Kuwait.
UAE introduces 9% corporate tax
Saudi and UAE double taxation agreement takes effect
The agreement with Kuwait comes five years after the UAE made a similar arrangement with Saudi Arabia on double taxation.
It also comes a year after the UAE introduced its first corporate tax regime, setting a corporation tax rate of 9% for firms with annual profits higher than US$100,000.
The Organisation for Economic Cooperation and Development recently rated this regime as “not harmful”, which was welcomed by the UAE’s Ministry of Finance. The ministry also added that there are no plans to introduce any changes to the corporate tax structure, nor to change the rate of VAT or introduce a personal income tax.