The UAE’s Federal Tax Authority (FTA) has been accelerating the adoption of artificial intelligence (AI) and advanced technologies to streamline tax administration, simplify procedures, reduce administrative requirements and to speed up transaction processing.
The initiative forms part of the Authority’s AI Strategy, which aligns with the UAE Artificial Intelligence Strategy 2031 and the government’s broader digital transformation agenda to enhance operational efficiency and customer experience.
Abdulaziz Mohammed Al Mulla, Director-General of the Federal Tax Authority, said AI applications are being deployed across key tax functions, including data analysis, risk assessment, request processing and workflow automation. The Authority employs artificial intelligence applications across various tax-related activities and procedures, most notably data analysis, risk assessment, improved request processing and process automation, Al Mulla said.
The Federal Tax Authority follows an integrated approach to AI deployment, beginning with identifying opportunities based on international best practices and consultations with business units.
The process includes assessing data readiness and strategic alignment before moving through phased implementation from proof of concept to full-scale operation, with a focus on high-value and practical use cases.
Smart VAT refund service for homeowners
One of the Federal Tax Authority’s most significant digital transformation milestones is the proactive VAT refund service for UAE nationals building new homes.
Through the Maskan smart application, refund requests are automatically generated once a building completion certificate or permit is issued by the relevant municipality. Applicants are then notified via text message and email to complete the remaining procedures electronically.
Federal Tax Authority rolls out AI-powered verification
The Federal Tax Authority has introduced AI-powered verification of refund amounts and suppliers’ tax registration numbers while automating several processing stages to improve accuracy and accelerate refund disbursements.
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Invoice details are automatically uploaded to users’ accounts when issued by registered suppliers. The system also consolidates invoices into a single file and reduces banking information requirements through integration with the Central Bank of the UAE.
VAT refunds exceed $1 billion
The value of VAT refunds provided to UAE nationals under the new home construction scheme reached approximately $1.01 billion (AED3.72 billion) from the service’s launch through the end of March 2026.
The Authority attributed the increase in beneficiaries to ongoing service enhancements and growing tax awareness driven by continuous outreach and education programs.
Tourism VAT refunds go fully digital
The Federal Tax Authority has also expanded its digital transformation efforts to the tourism sector through the digital VAT refund system for tourists.
The system incorporates digital invoices and self-service kiosks at airports, hotels and shopping centers, providing eligible visitors with faster and more seamless refund processing.
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Self-service kiosks allow fully automated refund transactions. The system readiness rate reached 100 percent in the first quarter of 2026, up from 99.99 percent in 2025.
The average processing time for refund requests was reduced to one minute and 10 seconds during the first quarter of 2026, reflecting the efficiency of the Federal Tax Authority’s digital infrastructure.
EmaraTax strengthens digital tax services
The EmaraTax platform continues to serve as a cornerstone of the UAE’s tax digitization strategy, offering businesses and individuals a unified platform for registration, tax return filing and payment of tax obligations.
The Federal Tax Authority has also continued to support compliance through tax clarifications, guidance materials, virtual and in-person events, and e-learning initiatives.
Excise tax model supports health goals
The FTA highlighted the implementation of the tiered volumetric excise tax model for sweetened beverages as another example of using tax policy to support public health objectives.
Under the system, excise tax is calculated according to the sugar and sweetener content of products, encouraging manufacturers to develop lower-sugar alternatives.
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In this context, Al Mulla said that the UAE was among the first countries in the region to implement a mechanism for calculating excise tax on sweetened beverages using the tiered volumetric model.
He expected the move to encourage beverage manufacturers to reduce sugar levels in their products, helping to lower tax burdens, improve product formulations and increase reliance on healthier alternatives.
Al Mulla added that the AI-powered product registration system integrated into the EmaraTax platform has simplified the registration of sweetened beverages under the new framework while supporting the health objectives associated with the tax.
