...On 31 January, the United Arab Emirates (Aa2 stable) Ministry of Finance announced a new federal corporate income tax (CIT) effective 1 June 2023. The new tax will broaden the federal government's revenue base, increasing its scope for spending and enhancing its already-strong fiscal metrics and debt-issuing capacity, which is currently capped at around 250% of own stable revenue. And, depending on the extent of revenue sharing with individual emirates, it will be credit positive for them too. Assuming that revenue sharing with the individual emirates is in line with the current approach for value added tax (VAT) receipts, the new tax will diversify Abu Dhabi's (Aa2 stable) government revenue away from hydrocarbons, although modestly. For the other emirates including Sharjah (Baa3 negative) and Dubai, the tax's revenue stream will augment license fees, service fees and volatile land sales. However, free zones in the UAE's non-oil economy will be exempt from the tax, which will limit the...