This study aims to explore the potential implications of introducing personal income tax (PIT) in the United Arab Emirates (UAE), focusing on its impact on work satisfaction, employee expectations (e.g. salary increases, flexible working hours, work-from-home options, pension benefits and paternity leave) and expatriates’ career choices.
Using data from 992 respondents (581 locals and 411 expatriates) collected through a self-administered questionnaire, this research provides new insights into how PIT may transform the socio-economic landscape of the UAE. A simple random sampling method was used, and the data were analysed using ordinal regression and a generalised linear model to ensure robustness.
The findings reveal that PIT could significantly enhance work satisfaction for local residents, but has no notable impact on expatriates in this regard. Both locals and expatriates show increased expectations for enhanced benefits with the introduction of PIT. However, expatriate career choices are significantly affected, with higher PIT rates (20%–40%) potentially prompting repatriation or migration to other tax-free countries.
To the first of the authors’ knowledge, this research is the first study to explore the potential implementation of PIT in the UAE. It offers valuable insights for tax planners, policymakers and businesses. The findings emphasise the strategic considerations needed to balance revenue generation with the UAE’s appeal as a global hub for talent and investment.
