Institutional Mandate and Legal Basis
The Ministry of Finance was established in 1971 as a founding ministry of the UAE federal government. Its mandate covers the formulation and execution of federal fiscal policy, preparation and management of the federal budget, administration of government revenues and expenditures, and oversight of federal government procurement and accounting. The ministry’s authority is grounded in federal law and its operations are governed by the financial regulations and standards approved by the UAE Cabinet.
Role Within UAE Governance Structure
The Ministry of Finance occupies a central coordinating role in the federal government’s fiscal architecture. It manages the allocation of federal resources across ministries and government entities, administers the collection of federal taxes and fees, and represents the UAE in international financial institutions including the International Monetary Fund and the World Bank. The ministry works closely with the Central Bank, emirate-level finance departments, and the Federal Tax Authority to coordinate monetary and fiscal policy and ensure compliance with national financial regulations.
Key Functions and Activities
The ministry’s principal functions include preparing the annual federal budget, managing federal government accounts and treasury operations, overseeing public procurement, administering government investment programs, and coordinating federal financial reporting. The ministry is responsible for the UAE’s sovereign credit profile and manages relationships with international credit rating agencies. Following the introduction of value-added tax in 2018, the ministry plays a strategic role in tax policy development and coordinates with the Federal Tax Authority on revenue administration. The ministry also manages the UAE’s participation in international development finance and donor programs.
Relationship to We the UAE 2031 Vision
The Ministry of Finance provides the fiscal framework essential to delivering the We the UAE 2031 vision. Sound public financial management ensures that government revenues are allocated efficiently to priority sectors including education, healthcare, infrastructure, and technology. The ministry’s budget modernization efforts, including performance-based budgeting and medium-term fiscal planning, align government spending with the strategic outcomes defined in the 2031 framework. The ministry’s work on fiscal sustainability, including revenue diversification through taxation, reduces dependence on hydrocarbon revenues consistent with the vision’s diversification goals.
Recent Developments and Strategic Initiatives
The Ministry of Finance has overseen the introduction and expansion of the UAE’s tax framework, including value-added tax and the corporate tax regime that took effect for financial years beginning in mid-2023. The ministry has modernized federal budget processes through digitalization and the adoption of international public sector accounting standards. It has expanded the UAE’s network of double taxation treaties and strengthened the country’s compliance with global standards on tax transparency and information exchange. The ministry has also led initiatives on green finance and sustainable government procurement.
Leadership and Governance
The Ministry of Finance is led by the Minister of State for Financial Affairs, who is a member of the UAE Cabinet. The minister is supported by undersecretaries and a professional staff organized into directorates responsible for budget, revenue, government accounts, procurement, and international financial cooperation. The ministry’s governance framework emphasizes transparency, accountability, and alignment with international best practices in public financial management, including regular audit and oversight by the State Audit Institution.