The Federal Tax Authority’s (FTA) Muwafaq Package, an initiative designed to support small and medium-sized enterprises (SMEs) in the UAE, has experienced remarkable growth since its launch in March 2023.
Director of Taxpayer Services at the FTA, Zahra Aldahmani, revealed to Arabian Business that the programme has now surpassed 54,000 registered users, a substantial increase from the 51,660 subscribers at its inception.
“By the end of April 2024, we’ve seen an impressive surge in registrations,” Aldahmani stated in an exclusive interview.
This growth underscores the package’s relevance to the UAE’s business landscape, where SMEs form a vital segment of the economy, accounting for the largest percentage of companies operating in the country.
The Muwafaq Package offers a comprehensive suite of benefits to facilitate tax compliance and streamline business operations for SMEs.
Key features include:
- Appointment of a dedicated FTA relationship manager
- Access to educational materials on tax procedures
- Competitive pricing on tax accounting software
- Tailored awareness sessions and workshops
- Priority service for certain FTA offerings
“The package offers a set of exclusive privileges,” she said. These include access to tax accounting software at competitive prices, dedicated tax relationship managers for personalised guidance, and special discounts on services from registered Tax Agents.
Additionally, SMEs enrolled in Muwafaq benefit from priority service with the FTA and access to educational workshops tailored to their tax needs. This comprehensive support system empowers SMEs to navigate tax procedures with ease, fostering a culture of tax compliance and contributing to a business environment that fuels their growth.
These benefits are particularly valuable in light of the UAE’s corporate tax structure, which came into effect in mid-2023.
The system employs a tiered approach, with a 0 percent rate applying to taxable income up to AED375,000 (approximately $102,000) per taxpayer, and a 9 percent rate for income above this threshold. It is still among the lowest corporate tax rates globally.
Muwafaq package benefits SMEs
The FTA has supported SMEs in the Gulf country through extensive outreach efforts, Aldahmani revealed.
“We’ve conducted workshops about the Muwafaq package across all seven emirates, attracting more than 1,700 SME representatives,” she said.
“Additionally, our team has made over 51,000 outgoing calls to registered taxpayers and facilitated around 167 interviews through the Muwafaq platform.”
Looking to the future, Aldahmani hinted at plans to expand the package’s offerings.
“We’re constantly exploring new benefits and privileges to add value for our users,” she explained. This could involve forging partnerships with leading local and international institutions across various sectors, including trade, banking, and digital services.
“The UAE leadership and government focus on the SME sector as a cornerstone of the national economy.”
The Muwafaq package aligns seamlessly with the UAE’s broader economic goals, forming an integral part of the FTA’s strategy to contribute to the government’s efforts to boost economic growth across various segments, she said.
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