The Ministry of Finance reported that the 2025 total compared with about Dh41 billion collected in 2024, reflecting sustained expansion in non-oil government income that equips authorities with expanded means to finance public services, infrastructure upgrades and strategic development programs across emirates. VAT and excise taxes, once introduced, have evolved into consistent contributors that lessen dependence on traditional hydrocarbon receipts while feeding allocations at both federal and local tiers. The ministry’s announcement underscored how these receipts enhance visibility for multi-year budgeting and reinforce overall fiscal steadiness amid broader economic activity.
Mohamed bin Hadi Al Hussaini, minister of state for financial affairs, stated that the growth in tax revenues reflects the strength of the UAE’s fiscal approach and its ability to maintain stable government resources that support economic and development priorities in the years ahead. Al Hussaini added that the financial data highlights the maturity of the UAE’s fiscal and tax framework, along with the transparency and discipline guiding the management of public resources. He described tax revenues as a key contributor to public finances within an institutional framework based on coordination, discipline and clearly defined roles.
The Ministry of Finance has worked closely with federal and local entities to improve the management of public revenues while strengthening the readiness of fiscal policies to respond to economic growth and future developments. Such collaboration ensures that distributed funds are deployed efficiently to sustain service delivery and long-term projects without disrupting the country’s competitive low-tax environment for businesses and residents. Al Hussaini noted that the continued strengthening of this framework supports the UAE’s development agenda and reinforces the competitiveness of the national economy.
The Federal Tax Authority’s 2025 annual report, released at the end of June, confirmed the Dh46 billion revenue total while recording a 20 percent increase in tax registration transactions that reached 1.7 million during the year. Those registration gains illustrate wider adoption of the tax system that first took effect in 2018 with the rollout of value-added tax at five percent alongside excise duties on targeted categories such as tobacco products and certain beverages. The authority’s data places the combined performance in the context of broadening compliance that has helped diversify revenue streams beyond oil since the taxes were first applied.
Ministry figures show the revenues are allocated directly to federal and local budgets, where they support spending on essential public services, economic initiatives and measures that build resilience against global market fluctuations. The 15 percent advance from 2024 aligns with patterns observed since the taxes became operational, contributing measurable support to non-oil fiscal components that now form a structural part of annual planning. According to the ministry assessment, this trajectory demonstrates the government’s capacity to develop sustainable revenue channels that preserve fiscal balance together with flexibility to pursue emerging growth prospects.
