On 12 October 2026 the UAE Cabinet approved a three-year federal budget of Dh292.5 billion for 2027–2029 — up 28.3% on the previous cycle. The 2027 single-year allocation is Dh90.1 billion, with social development and pensions as the largest line item.
What the Cabinet approved
On 12 October 2026, the UAE Cabinet, chaired by HH Sheikh Mohammed bin Rashid Al Maktoum, Vice President, Prime Minister of the UAE and Ruler of Dubai, approved the federal budget for the 2027–2029 cycle at a total of Dh292.5 billion. This is 28.3% higher than the previous three-year cycle for 2024–2026.
The 2027 single-year budget was approved at the same meeting at Dh90.1 billion in expenditure. Sheikh Mohammed framed the priorities in a short public comment: "Our priorities remain constant: education, healthcare, housing, social services, and the quality of life and stability of our citizens."
How 2027 spending breaks down
The structure of the 2027 budget shows which areas the government considers central over the coming year. Five categories receive between Dh3 billion and Dh34.6 billion, with social spending roughly 1.2× the next largest line.
| Spending category | Amount, AED bn | Share |
|---|---|---|
| Social development and pensions | 34.6 | 38.4% |
| Government affairs | 29.1 | 32.3% |
| Federal expenses | 17.8 | 19.7% |
| Financial assets and investments | 5.6 | 6.2% |
| Infrastructure and economic resources | 3.0 | 3.4% |
| 2027 total | 90.1 | 100% |
Sources: UAE Cabinet decisions of 12 October 2026, reporting by Gulf News, The National and Emirates24|7 of the same date.
Where the UAE is directing spending
The headline change is immediate. Social spending — 38.4% — now clearly outpaces "government affairs" (32.3%), which has often been the largest line in prior cycles. Education, healthcare, pensions and social payments form the core of the federal budget, consistent with Sheikh Mohammed's public framing of unchanged priorities.
Second — the share of infrastructure and economic resources at federal level is strikingly low (3.4%, or Dh3.0 billion). This does not mean the UAE is pulling back from infrastructure build-out: most capital projects run through emirate-level budgets (notably Abu Dhabi and Dubai), sovereign funds (ADQ, Mubadala, Dubai Investments) and state-linked companies (ADNOC, Etisalat/e&, DP World). The federal budget is deliberately focused on people and administration, not megaprojects.
Third — the 2027–2029 cycle has been introduced as the first federal budget with explicit emphasis on artificial intelligence, sustainability and operational efficiency. In government framing, this means that within "government affairs" the growing lines are digitalisation of public services and AI deployment, not just ministry overheads.
What this means for business in the UAE
For companies and expats working in the Emirates, a Dh292.5 billion three-year budget is a signal of tax and regulatory stability over 2027–2029. The federal revenue base relies on corporate tax at 9% on profits above AED 375,000 and 5% VAT; the 28.3% rise in spending is financed by broadening the base and underlying growth, not by higher rates. That removes "tax hikes to pay for the budget" as a near-term risk for the next three years.
Second practical takeaway — the social-spending priority supports companies that hire specialists from abroad: education, healthcare and housing for UAE citizens underpin the quality of the working environment that expats also live in. Third — the push toward AI and digital public services accelerates electronic workflows: company registration, visa procedures, FTA tax filings and payments into the federal budget will keep shifting into "minutes, not weeks" through digital portals.
Context: where the UAE economy is heading
The 2027–2029 budget sits on top of a macro forecast that treats the 2026 dip as temporary. The UAE Central Bank's September review assumes a rebound to 9.8% growth in 2027 — more detail on how the UAE Central Bank is forecasting +9.8% growth for 2027 and which sectors carry the main risk in the current cycle. The three-year budget horizon lines up with this projected rebound: the government is raising spending ahead of the economic turn, not at its peak.
For businesses planning entry into the UAE or expansion of existing structures, the 2027 window looks like a "post-dip, pre-peak" moment: regulation is predictable, digitalisation spending is rising, and the social base is stable. Breakdowns by emirate and the formal finance law vote in the Federal National Council are expected over the coming weeks.
