Provisions

The agreement aims to identify all the recipients of tax and financial benefits who will be covered by the main agreement, including federal government institutions and local and sovereign funds, in addition to UAE nationals and private sector institutions which own investments in Japan.

National airlines are also exempted from taxes, as well as any other UAE-based airlines.

Taxes on dividends are reduced from 20% to 5% in cases where any UAE institution or company owns 10% capital of any Japanese company.

Additionally, in cases where companies do not own that percentage, the taxes will be decreased from 20% to 10%.

Japan will exempt all UAE federal and local government institutions in addition to UAE sovereign funds from a 20% tax on interest profits.

Typically, Japan imposes a 30% tax on capital profits as well, for residents and non-residents. Under the agreement, capital profits tax which results from owning shares or any interest in a company, including trust funds shall be exempted.