Businesses are going to start paying tax in the UAE for the first time ever next year after the government yesterday announced it would introduce a federal corporate tax from 1 June, 2023.

It’s not going to be a lot, though: Businesses will pay a 9% tax on profits, one of the lowest corporate tax rates in the world.

And the rest of the zero-tax regime will remain: Companies that do business in freezones will not be subject to the new tax provided they don’t trade with the mainland, and individuals will continue to pay no income tax.

The rationale: The government says it’s introducing a corporate tax to align with international standards and crack down on tax avoidance — and that the move would pave the way for a different, global rate to be applied to big multinationals. The UAE has signed on to the OECD’s plan to institute a global minimum corporate tax of 15%

Citigroup is hiring as it vies for Gulf listings: Citigroup is increasing its presence in GCC countries ahead of what it predicts will be another record year for IPOs in the region, Bloomberg reports. The bank is boosting its existing Saudi and Dubai offices and “adding resources all across the region,” joining Goldman Sachs and others looking to capitalize on strong Gulf IPO pipelines as listings elsewhere drop off.

THE CLOSING BELL-

The EGX30 rose 0.3% at yesterday’s close on turnover of EGP 647 mn (41.5% below the 90-day average). Foreign investors were net sellers. The index is down 3.8% YTD.

In the green: TMG Holding (+8.6%), Qalaa Holdings (+5.2%) and Madinet Nasr Holding (+4.0%).

In the red: CIRA (-3.6%), Fawry (-1.8%) and CIB (-1.0%).

Major Asian benchmarks are solidly in the green this morning with just Shanghai slipping into the red. All major European benchmarks look set to follow suit later today. The story is a bit different across the pond, where futures suggest Wall Street will see the S&P, Nasdaq and Dow all open in the red at the opening bell.