The United Arab Emirates announced Monday it is introducing for the first time a federal corporate tax on business earnings. It's the latest measure to bring the country in line with many governments worldwide but one that also chips away at its competitive advantage.

The UAE, home to Abu Dhabi, Dubai and five other emirates, has been steadily introducing new taxes as it seeks to diversify revenue from its mainstay of oil. It is unclear how the new 9per cent corporate tax on earnings will impact consumers as some businesses could raise their prices as a result.