UAE Federal Tax Authority Announces A Program for Tax Violations & Evasions

No more hiding for violators and evaders. The UAE’s Federal Tax Authority (FTA) formally launched a dedicated whistle-blower program —Raqeeb— as a means of discouraging evasion and other violations.

The goal of the new program is to alert the public to a platform where they can report businesses, entities, or companies that engage in fraudulent violations of the UAE’s tax laws. On April 15, 2022, the UAE’s Cabinet Decision for this program officially took effect, and it set the rules on how any reports are submitted and handled.

The FTA can now receive information on individuals or businesses suspected of evading taxes, marking a significant push towards transparency and accountability.

 

Everything You Need to Know About the FTA Whistle-Blower Program

• Mission & Aim of the Raqeeb
• Significance of the Program
• Benefits or Advantages of Raqeeb for Tax Evasion & Violations in the UAE
• Functioning of the Program
• Which Violations & Evasions Does Raqeeb (Whistle-Blower Program) Apply to?
• Role of Authority in Regards to Information Provided by Informant?

 

What is the aim of Raqeeb?

At its core and mission statement, the purpose of Raqeeb is to:

• Strengthen the overall tax compliance across the UAE
• Reduce or eliminate tax evasion and violations
• Provide a tight systematic control over the local market

 

Why should the program matter or its significance?

Tax evasion and noncompliance are global issues that threaten economic stability and disrupt a fair system for a competitive market.

The introduction of Raqeeb in the UAE reflects the state’s commitment to:

• Equal business operation across the market
• Encouraging transparency and building trust in the system
• Promoting a chance at ethical business behaviour

 

Advantages of the Raqeeb Whistle-Blower Program:

Aside from the government benefits, the initiative has many societal and practical benefits.

• Protects local markets and ensures public funds have protection from tax-related abuses.
• Offers members of the public the opportunity to participate in economic regulatory efforts.
• Pushes compliance by individuals and businesses. Stops illegal behaviour.
• Encourages a fair, competitive market for businesses and transparency.
• Promotes public confidence in the system.
• Safeguards the UAE’s financial resources

 

How does the Raqeeb Program work?

The Raqeeb has a straightforward design and, of course, a confidential process for reporting violations at any level.

Anyone can file a report on the FTA website, which includes detailed guidelines on how to submit relevant information. It also:

• explicitly explains the financial rewards for whistle-blowers,
• requirements to submit a report, and
• other legal considerations.

 

Reports by individuals or businesses are strictly confidential, as the FTA guarantees that informants’ identities remain secret. Even informants are to sign a Non-Disclosure Agreement (NDA) before submitting to keep investigations and assessments quiet.

 

What violations and evasions does Raqeeb cover?

According to the FTA, the whistle-blower program applies to violations involving self-reported levies, such as Value Added Tax (VAT) and Excise Tax.

The program is, however, expected to go beyond the scope of these two areas with the introduction of the 2023 Corporate Tax regime.

 

Are informants rewarded?

Simple answer: yes. But, the exact reward and criteria has clauses explained on the Raqeeb platform. For instance, any individual whose relevant information leads to the FTA recovering AED 50,000 or more of unpaid taxes is eligible for a monetary reward.

 

What does the authority do with the information provided by the informant?

Once submitted to the FTA’s Raqeeb Program, they may:

• Use the information to detect and confirm whether or not a violation has occurred.
• Assess if the information qualifies the informant for monetary rewards.
• Establish all the necessary procedures to handle each report uniquely.
• Request additional information to substantiate the informant’s claim.

 

Key Takeaway

The UAE’s whistle-blower program remains a major step forward in building a transparent, compliant, trustworthy tax environment between the government and the public.Raqeeb not only protects the economy but also empowers residents to protect their system from illegal activities.

It’s a win-win system for the government and local markets that ensures a fair, competitive economy for all.