They’re competing to lead the digital world, and removing taxes is a smart move for them to help crypto grow in the country. I believe they’re not focused on immediate profits but rather on the long-term benefits, which makes sense. They have plenty of resources to collect taxes from, so since crypto is still new, it’s a good call not to be too aggressive with taxes. Hopefully, other countries will follow suit because sometimes heavy taxes slow down progress and development.
I love the UAE when it comes to competition with other world trying to be among in also controlling what ever other countries are controlling, because they don't take football that serious but since the World Cup a lot of things have changed and now they are taking football seriously and they want to buy all the prominent players just to make their own league colorful. And with this police's of making vat free for crypto users might even bring more people to want to stay in their country.
They most have understand that bitcoin is a future investment and that is why they want to take advantage and invest all they can, the government have made investing in crypto easy now, UAE is rich and they don't have problem with money, canceling vat does not affect the revenue flow of the country, they are among the bless nation.
When it comes to tax I don't think they will follow because other countries are addicted to way of making money from the citizens.