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UAE: FTA launches 'whistle-blower' scheme for tax violations, evasion today

The initiative called “Raqeeb” is in line with the Cabinet decision aimed at raising awareness among the public and increasing compliance rates

The Federal Tax Authority on Thursday launched a “whistle-blower” programme for tax violations and evasion, which aims to promote community control over local markets, raise the level of tax compliance and reduce tax evasion cases in the UAE.

The initiative called “Raqeeb” was rolled out in line with the Cabinet decision aimed at raising awareness among the public and increasing compliance rates. It is effective as of today, April 15, 2022.

The scheme allows the FTA to receive reports from individuals on tax evasion cases, tax-related fraud, and violations of tax legislation. It also allows the authority to verify the reports and grant monetary rewards to informants when certain conditions are met, the FTA said in a statement.

The programme seeks to enhance transparency and competitiveness in the field of doing business, raise tax compliance rates, and boost tax awareness and society’s confidence in the tax system. It also motivates individuals to carry out their social responsibilities and contribute to combating tax violations. The programme grants the informants with monetary rewards if the report leads the authority to collect tax amounts worth more than Dh50,000.

Khalid Ali Al Bustani, director general of the FTA, said the campaign is in line with the leadership’s directives to implement the tax system in accordance with the highest standards that drive further growth of the national economy, ensure transparency, and maintain economic momentum by providing a legislative environment that encourages self-compliance, and keeping pace with changes through continuous issuance of decisions in accordance with the interim requirements.

“By implementing the whistle-blower program for tax violations and evasion, the Authority strives to provide an opportunity for all segments of the community to contribute to regulatory efforts, help protect markets and public funds from tax evasion, drive compliance among all taxpayers, and prevent illegal practices,” he added. “The program contributes in strengthening the concept of community partnership to reduce harmful practices in local markets and help protect the UAE’s financial resources. Tax evasion is one of the most significant challenges which the tax systems around the world face, considering that it is an illicit practice that is harmful to the economic systems, and curbing such practices requires joint efforts from the government and society,” said Al Bustani.

The FTA called on all community members to participate in the efforts through the program, which provides an easy and clear mechanism for reporting tax violations. Reporting information can be done through the FTA’s website, which also includes a comprehensive guide on the program, how to report, the criteria and mechanism for obtaining monetary rewards for reporting, and other introductory, legal and procedural matters related to the program.

The mechanism for reporting tax violations adheres to the highest confidentiality standards, and ensures that the identity of the informants is not disclosed to any party, and provides them with full protection and immunity to ensure that they are not exposed to any harmful consequences for carrying out their social responsibilities by reporting illegal practices.

The programme also ensures that the tax system is being implemented justly without evasion or fraud, and reduces the duration for investigations related to cases of tax evasion and violations of tax legislations, by providing additional evidence that the Authority can rely on in its procedures to ensure the accurate collection of taxes and ensure greater effectiveness in audits, thus curbing tax evasion, the FTA statement said.

— issacjohn@khaleejtimes.com