What is tax evasion under UAE law?

Article 25 – Tax Crimes and their Penalties 1. The penalties set out in this Decree-Law shall not prejudice any more severe penalty applicable under any other law. 2. A prison sentence and a monetary penalty not less than the amount of evaded Tax and not exceeding (3) three times of it, or either of the two, shall be imposed on any Person who has committed Tax Evasion by any of the following acts: a. Deliberately failing to settle any Payable Tax. b. Deliberately understating the actual value of his Business or his revenues or failing to consolidate his related Businesses, with the intent of remaining below the relevant registration threshold, Tax rate or other Tax thresholds, as specified in the Tax Law. c. Deliberately imposing and collecting amounts as Tax without being registered. d. Deliberately decreasing the Due Tax or participating in any form of Tax Evasion. e. Deliberately committing or omitting any other act which may constitute Tax Evasion under this Decree-Law or the Tax Law. 3. A prison sentence and a monetary penalty not less than the amount of the Administrative Penalty and not exceeding (3) three times of it, or either of the two, shall be imposed on any Person who deliberately does not settle a due Administrative Penalty, unless a decision is issued waiving thereof. 4. A prison sentence and a monetary penalty not exceeding (1,000,000) one million Dirhams, or either of the two, shall be imposed on anyone who commits any of the following acts: a. Deliberately providing false information, data and incorrect documents to the Authority. b. Deliberately concealing or destroying documents, information and data or other material that he is required to keep and provide to the Authority. c. Stealing documents or other materials that are in the possession of the Authority or deliberately misusing or destroying them. d. Deliberately preventing or hindering the Authority’s employees’ from performing their duties. Federal Decree-Law No. 28 of 2022 and its amendments – As published by the Ministry of Finance 16 5. If any of the acts in the previous Clause has occurred which resulted in Tax Evasion or facilitating or concealing Tax Evasion, the penalty set out in Clause 2 of this Article shall apply. 6. Any Person proven to have directly participated or caused any of the crimes set out in this Decree-Law or the Tax Law shall be penalised with the penalty prescribed in this Decree-Law in accordance with the provisions on criminal participation stated in Federal Law No. 31 of 2021 referred to. 7. If a monetary penalty has been imposed on several accused in one judgement and for one crime, whether they are perpetrators or accomplices, the accused shall be jointly liable for such monetary penalty. 8. Reoffending is considered an aggravating circumstance, and in the application of the provisions of this Decree-Law or the Tax Law, everyone that has been sentenced by a final judgment in one of the crimes stipulated in this Article, whatever the imposed penalty is, and then committed any of these crimes before the expiration of (5) five years from the date of the issuance of the final judgment referred to, shall be considered to be a reoffender. 9. Without prejudice to Clause 11 of this Article, everyone who has participated in a Tax Evasion crime, shall be jointly and severally liable with the Person with whom he participated, to settle the Payable Tax and Administrative Penalties. 10. The court may upon conviction publish the judgement or its summary by a suitable means and the convicted Person shall bear the cost, on the condition that such publication is upon request by the Authority to the Public Prosecution. 11. The judgement to impose a penalty under the provisions of this Decree-Law or any other law shall not exempt any Person from the liability to settle any Payable Tax or Administrative Penalties.

Article 23 – Instances of Tax Evasion11 Without prejudice to the instances of Tax Evasion referred to in the Tax Procedures Law, a Person shall be deemed to have committed Tax Evasion and penalised in accordance with the Tax Procedures Law if he conducts any of the following: 1. Bringing or attempting to bring Excise Goods into or out of the State without payment of the relevant Due Tax in part or in full. 2. Producing, transferring, acquiring, storing, transporting or receiving Excise Goods the Due Tax of which was unpaid and with the intention of evading such settlement. 3. Placing false distinguishing marks on Excise Goods, contrary to the text of clause 2 of Article 24 of this Decree-Law, with the intent of evading the settlement of Due Tax or receiving unlawful refunds. 4. Submitting any false, counterfeit or unreal documents, returns or records, with the intent of evading the settlement of Due Tax or receiving unlawful refunds. 10 Article amended as per Federal Decree-Law No. 19 of 2022 11 Article amended as per Federal Decree-Law No. 19 of 2022 Federal Decree-Law No. 7 of 2017 and its amendments – As published by the Ministry of Finance 11 Chapter Ten – General Provisions

Article 77 - Tax Evasion37 Without prejudice to the instances of Tax Evasion referred to in the Tax Procedures Law, if it is proven that a Person who is not a Registrant acquires Goods referred to in Clause 3 of Article 48 of this Decree-Law, claiming that he is a Registrant, he shall be considered as having committed Tax Evasion and shall be penalised in accordance with the Tax Procedures Law. Title Ten – General Provisions

Article (23) Tax Evasion 1. For the purposes of the provisions of this article, tax evasion means the following: a) Bringing or attempting to bring Excise Goods into a Member State, removing, or attempting to remove them therefrom in violation of the laws in force in that State without payment of Due Tax thereon in part or in whole, or in a manner contrary to the prohibition or restriction provisions contained in the applicable laws of the Member State. b) The production, processing, possession, storage, transport or receipt of Excise Goods on which the Due Tax has not been paid, in violation of the provisions of this Agreement and Local Laws with intent to avoid the payment of the Due Tax, or to circumvent the prohibition or restriction provisions contained in the applicable laws of the Member State. c) Submitting incorrect, falsified or fabricated documents, returns or records, or placing false marks/stamps with intent to evade the payment of Due Tax or to receive refunds without claim of right. 2. Each Member State may determine other cases of tax evasion. 3. Each Member State shall determine the penalties for tax evasion.

Article 1 – Definitions The following words and expressions, as stated in this Decision, shall have the meanings assigned against each, unless the context otherwise requires: Authority VAT Law : : Federal Tax Authority. Federal Decree-Law No. 8 of 2017 referred to above, and any other Federal Decree-Law replacing it. Federal Tax Authority Decision No. 13 of 2026 – Unofficial translation 1 Taxable Person : Input Tax : Tax Evasion : Any Person registered or obligated to register for Tax purposes under the Decree-Law. Tax paid by a Person or due from him when Goods or Services are supplied to him, or when conducting an Import. The Person’s use of illegal means, resulting in the reduction of the amount of the Due Tax, non-payment thereof, or a refund of Tax that the Person did not have the right to have refunded.