The UAE’s Ministry of Finance (MoF) has issued two new ministerial decisions for corporate tax purposes in Free Zones, expanding the scope of Qualifying Activities and providing key clarifications for businesses. The updates are designed to strengthen the country’s position as a leading global hub for business and investment by providing a supportive and transparent tax environment.
Key Highlights
The new decisions introduce several important updates and clarifications for Free Zone companies:
- Expanded Scope: The scope of Qualifying Commodity Trading has been expanded to include industrial chemicals, associated by-products, and environmental commodities.
- New Decisions: Ministerial Decision No. (229) of 2025 on Qualifying Activities and Excluded Activities, and Ministerial Decision No. (230) of 2025 on the Specification of Recognised Price Reporting Agencies have been issued.
- Clarifications: The updates provide clarifications on Treasury and financing services for Related Parties.
A More Flexible and Clear Framework
The new decisions reflect the pivotal role of Free Zones in driving the UAE’s economic growth and their importance in the country’s economic diversification strategy. Ministerial Decision No. (229) clarifies the scope of the trading of Qualifying Commodities by removing the term “in raw form” and instead allowing the trading of a wider range of commodities, provided that a quoted price exists on a recognized exchange or from a recognized price reporting agency. To provide further certainty for taxpayers, Ministerial Decision No. (230) lists the recognized pricing agencies.
Supporting a Competitive Business Environment
Other beneficial changes in the new decisions include the activity of self-investment for the Qualifying Activity of Treasury and financing services, and a clarification that the distribution of goods from a Designated Zone to public benefit entities will not impact the de-minimis threshold. The Ministry emphasized that the UAE’s competitive Corporate Tax regime, coupled with this preferential tax treatment for Qualifying Activities, strengthens the country’s position as a leading global hub for business and investment.
Source: Zawya
