Non-compliance and tax evasion are problems that negatively affect the economy and generate illegal competition for businesses. To address this issue, the Federal Tax Authority (FTA) of the UAE has introduced an initiative known as Raqeeb. The program incentivizes individuals to provide information on tax evasion and provides financial rewards for such information. Let us dissect how this program operates, the rewards and the implications for businesses and individuals.
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What is the Raqeeb Program?
The Raqeeb program is a whistleblowing program launched by the UAE government. The program enables individuals to report companies or individuals who are in tax non-compliance. The FTA investigates the reports and, if the information results in tax recovery, the whistleblower will be rewarded with a payment.
The program has the following objectives of:
- Fostering fairness in the business environment.
- Encouraging compliance with taxes.
- Rewarding those who assist in revealing tax offences.
Who Can Be an Informant and get a reward?
An informant is anyone who provides information about tax-related offences to the FTA for the purpose of getting rewarded. This may include:
- Workers who observe illegal activities in their workplace.
- Customers who observe businesses evading tax.
- Anyone with genuine information on tax evasion or non-compliance.
However, some people are not eligible for rewards, including FTA staff, their family members, and tax agents.
Who Cannot Be an Informant?
The following entities cannot be the informant for the purpose of rewards;
- FTA employees.
- Tax agents
- Individuals who are somehow connected with the FTA and obtained the information due to this connection.
What Information Can You Report?
The FTA wants information on:
- Businesses that fail to issue valid tax invoices.
- Businesses under-declaring income or overstating expenditure.
- Individuals or businesses that fail to register for tax.
- Collecting VAT but not remitting it to authorities.
- Offering lower prices for cash payments without issuing tax invoices.
- Any other prohibited activities in the UAE tax legislation.
To be taken seriously, you need to provide evidence. This may be documents, invoices, or any other supporting evidence for your claim.
How to Make a Report?
Reporting is quite simple:
- Go to the FTA website and click on the Raqeeb icon.
- Complete the whistleblowing form with information about the violation and the individual or company involved.
- Upload documentation supporting your claim.
- Sign a confidentiality agreement to maintain your anonymity.
The FTA will review your report after you submit it and may call upon you for more information.
Monetary Rewards for Whistleblowers: How It Works?
If your report results in the recovery of taxes owed over AED 50,000, you might be entitled to a monetary reward. The amount of the reward is directly proportional to the recovered tax.
To be eligible, your report needs to:
- Be true and fact-based.
- Result in the collection of taxes.
- Comply with all the terms specified by the FTA.
After collecting the tax and once all legal proceedings are finalized, the FTA will inform you and pay you the reward in your provided bank account.
Confidentiality and Protection of Informant
FTA guarantees the confidentiality of your identity. Your data will never be disclosed to the reported entity or utilized during court proceedings. Such protection provides confidence to more individuals to report without fear of persecution.
Why is Raqeeb Important?
The Raqeeb initiative is a tax compliance revolution for the UAE. It enables people to act against tax evasion and promotes a fair level playing field for companies. Monetary rewards are employed by the FTA to incentivize people to support an open and fair tax system.
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If you found the above information helpful and want to stay updated on tax matters, consult Tax Gian. Our expert tax agents at Tax Gian keep track of tax dynamics and guide our clients accordingly. You can comply with tax laws better with the expert assistance of our tax agents at Tax Gian.
