Dubai:The Ministry of Finance (MoF) has announced the issuance of a new Cabinet Decision concerning Administrative Penalties related to the UAE eInvoicing framework, which will replace Cabinet Decision No. (106) of 2025.
According to Wam, the amendments were introduced after considering stakeholder feedback and are part of the Ministry's efforts to establish a compliance framework that is clear, proportionate, and practical for businesses. The new Cabinet Decision revises several administrative penalties from the previous Decision to align them better with the nature of relevant obligations, aiming to maintain the integrity of the eInvoicing system and encourage timely compliance.
The updated penalty framework introduces a proportionate approach to non-compliance by both the Issuer and the Recipient regarding eInvoicing implementation obligations. A penalty of AED5,000 will apply for the initial violation, with an additional AED5,000 for each month or part thereof during which the non-compliance persists, up to a maximum aggregate penalty of AED50,000 within any twelve consecutive months. The new Decision also removes the penalty for failing to notify the Authority of a system failure, ensuring penalties are more appropriately applied.
The Ministry aims to refine the penalty regime to reduce unnecessary administrative burdens and provide businesses with greater clarity and certainty as they transition to digital invoicing. Furthermore, the Decision prevents duplication of penalties by imposing only one penalty when the same Person acts as both an Issuer and a Recipient for the same violation.
These amendments support the UAE's digital transformation objectives and reinforce its commitment to implementing a modern tax administration framework that promotes effective compliance and a business-friendly environment, aligning with international best practices.