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Dubai offers instant VAT refunds for Chinese tourists

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Chinese tourists to Dubai can now benefit from instant VAT refund capabilities at Dubai Airports via the We Tax Refund on the WeChat Mini Program, launched by Chinese tech giant, Tencent, and international payments service provider, Planet.

With the support of Dubai’s Department of Tourism and Commerce Marketing (Dubai Tourism), the new integrated service provides a seamless and secure way for visitors to instantly claim back their tax on purchases they have made while visiting the emirate, and further supports the Department’s ongoing ‘China Readiness’ strategy to grow and maintain the emirate’s share in a key source market while enhancing holistic experiences of its Chinese guests. Read more..

 

UAE excise tax on e-cigarettes, sugary drinks to start on December 1

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The excise tax on electronic smoking devices and sweetened beverages will be effective as of December 1, 2019, according to the Federal Tax Authority (FTA).

The authority called on producers and importers of the products to register for the excise tax system at the earliest to avoid late registration fines.

The UAE initially introduced 50-100 percent excise tax on harmful goods such as soft and energy drinks and tobacco in October 2017 in a bid to improve public health and cover the costs of public services through the newfound government revenue. Read more...

 

UAE's Federal Tax Authority issues warning over VAT scam

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The UAE's Federal Tax Authority on Tuesday issued a warning after reports of scammers trying to target bank customers over VAT refunds.

In response to reports that some bank customers have received emails from unidentified sources impersonating banks and financial institutions requesting personal data in the promise of helping them claim VAT refunds, the FTA reaffirmed that they can only be processed through its official website.

The authority said that some recipients have been asked to provide personal data, including names, credit card numbers, and PIN codes, claiming that providing the information will allow them to recover VAT. Read more...

 

UAE Federal Tax Authority in Digital Tax Stamp inspections

The UAE Federal Tax Authority (FTA) has conducted two simultaneous awareness and inspection campaigns — to verify compliance with the Marking Tobacco and Tobacco Products Scheme.

The move has come during the first month since the ban on selling cigarettes not bearing the Digital Tax Stamps in local markets went into effect. The stamps, placed on cigarette packages, allow for tracking of the products from the manufacturing facility until they reach the end consumer. Read more...

 

Expo 2020 Dubai to help drive VAT revenues over $8bn this year

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Increased spending on Expo 2020 will help value added tax (VAT) revenues in the UAE push to over $8 billion (AED30bn) this year, according a Dubai-based tax consultancy. 

Revenues will also be boosted by a growth in retail, hospitality, aviation and shipping, but Rajiv Hira, chairman, RHMC Management Consultants, said the huge increases will not be sustained over the longer term. Read more...

 

VAT receipts will help Ras Al Khaimah to cut debt, says Fitch

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Fitch Ratings has affirmed the emirate of Ras Al Khaimah’s long-term issuer rating of A and assigned it a stable outlook, based on its low levels of government debt and high gross domestic product (GDP) per capita.

“The emirate derives substantial support from its membership of the UAE,” the ratings agency said in a report, citing the UAE's common monetary and exchange rate system and its "credible" dollar peg as significant advantages.

“Most public services and infrastructure are provided directly by the federal government, making RAK's spending more flexible than peers and relieving the emirate of some of the spending needs of a typical sovereign,” it added. Read more...

 

UAE to add sugary drinks, e-cigarettes to excise tax list in 2020

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The UAE Cabinet on Tuesday announced a decision to expand the list of excise taxable products to include sweetened beverages, sugary drinks and electronic smoking devices, starting from January 1, 2020.

The decision to add a tax of 50 percent is part of efforts to reduce consumption of unhealthy goods and modify consumers’ behaviour, state news agency WAM reported

A statement released by the Cabinet General Secretariat read: "The decision comes to support the UAE government's efforts to enhance public health and prevent chronic diseases directly linked to sugar and tobacco consumption. Read more...

 

FTA launches new excise goods registration system

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The UAE’s Federal Tax Authority (FTA) has launched a new electronic system for registering excise goods.

In a statement on Saturday, the FTA said that the new system is designed to offer transparent guidelines and standards for the registration of goods, along with new reporting requirements related to excise tax returns and declarations.

The FTA is urging all businesses to follow the new process and ensure that the required documents are readily available when submitting a registration request. Read more...

 

New UAE tax rule on two products from November 1

The Federal Tax Authority (FTA) is ramping up its efforts in preparation to implement the second phase of the 'Marking Tobacco and Tobacco Products Scheme', where it will be expanded to cover waterpipe tobacco (known in Arabic as 'Mu'assel') and electrically heated cigarettes as of November 1, 2019.

Digital Tax Stamps will be made available for purchase by producers and importers of waterpipe tobacco and electrically heated cigarettes, the authority revealed, as it held its second awareness workshop in Dubai to introduce them to the scheme's procedures and objectives, as well as the timeline for the second phase. The workshop was led by FTA experts and representatives from De La Rue, the company commissioned by the authority to operate the system. Read more...

 

UAE Federal Tax Authority: Bank Interest and Dividends Outside the Scope of VAT

The Federal Tax Authority (FTA) asserted that passively earned interest income from bank deposits and dividend income are outside the scope of Value Added Tax (VAT), and there is no requirement to report them in the VAT return.

VAT is a tax imposed on the import and supply of goods and services at each stage of production and distribution, therefore, VAT implications arise only when there is a supply – if there is no supply, there is no VAT implication.

The FTA explained that the Federal Decree-Law No. (8) of 2017 on VAT and its Executive Regulations have included specific provisions on what would constitute a supply of goods and a supply of services and also included a definition for taxable supplies. Read more...

 

New shisha tobacco, e-cigarettes tax rule announced in UAE

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His Highness Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai and Minister of Finance, and Chairman of the Federal Tax Authority, FTA, has issued a Decision whereby the "Marking Tobacco and Tobacco Products Scheme" will be implemented on water pipe tobacco and electrically heated cigarettes as of November 1, 2019.

The decision also determines the dates when "Digital Tax Stamps" will be made available, as well as the standards for stockpiling them. Read more...

 

Daily VAT cash refund limit capped at Dh7,000, unlimited for cards

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Tourists visiting the UAE can claim only Dh7,000 per day as cash under the VAT refund scheme, but there is no maximum limit set for refunds effected through credit cards, the Federal Tax Authority (FTA) clarified on Sunday.

Sheikh Hamdan bin Rashid Al Maktoum, Deputy Ruler of Dubai, UAE Minister of Finance and Chairman of the FTA, has issued a new order, setting this daily maximum limit for VAT cash refunds for tourists applying through the Tax Refunds for Tourists Scheme that came into effect from November 2018. Read more...

 

Federal Tax Authority launches new website

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The UAE Federal Tax Authority (FTA) launched its upgraded website with a bundle of services and amenities for users, also enabling them to submit forms online.

“The Federal Tax Authority has designed its new website in accordance with international best practices," said FTA director general Khalid Ali Al Bustani

"The site plays a fundamental role as the main platform of the Federal Tax Authority in order to keep pace with the rapid technological development in this area. It has been configured to provide the best services for business, facilitate optimum access to customers and employs the latest technologies to enhance interaction between the authority and the various business sectors around the clock. Read more...

 

Dubai biggest beneficiary of VAT revenue

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Dubai was the largest beneficiary among the seven emirates in value-added tax (VAT) collection last year, receiving 42 per cent or Dh11.34 billion of the Dh27 billion total, Moody's Investors Service said.

Data from the global ratings agency showed that the federal government will retain 30 per cent, or Dh8.1 billion, of the collected revenues while the remaining Dh18.9 billion, or 70 per cent, will be divided among the emirates. Read more...

 

UAE's VAT revenues beat estimates, Moody's says

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Revenues from the UAE’s value added tax, which came into effect in January last year, exceeded government expectations in 2018, boosting state coffers and proving credit positive for the country, according to a Moody’s analysis.

“With non-oil sector growth still subdued, the strong VAT out-turn was largely attributable to higher than expected compliance with the new law,” the rating agency said in a report this week.

“The government’s 2018 and 2019 VAT revenue forecasts had included conservative assumptions regarding the level of compliance in the initial years of implementation.” Read more...

 

FTA approves 390 VAT refunds totalling Dh17.5 million

The Federal Tax Authority, FTA, has announced approving 390 VAT refund applications totalling Dh17.5 million, for Emiratis who paid it when building their homes.

Khalid Ali Al Bustani, Director General of FTA, stressed that the FTA’s move comes in implementation of the wise leadership vision, aiming to develop a modern housing system for Emiratis and provide the best standards of living. Read more...

 

Self-service VAT refund system for tourists launched across UAE

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Tourists now have an easy way to claim back VAT before departing the UAE thanks to the launch of self-service kiosks across the country.

Planet, the company tasked with overseeing tax refunds on goods purchased while visiting the country by the Federal Tax Authority, is turning to technology to make the process simpler.

Rather than visit an office to complete refund procedures, people can do it themselves by taking advantage of the new fully-automated service, which has been rolled out at airports and ports. Read more...

 

Will VAT rate go up in GCC?

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The GCC states will eventually increase value-added tax (VAT) rate, which is one of the lowest in the world, but it could take years before the regional government agree to hike it, tax experts said at a summit on Monday.

Surandar Jesrani, managing partner and chief executive officer (CEO) of MMJS Tax Consultancy, said the UAE and Saudi Arabia cannot unilaterally raise VAT as it is GCC-wide framework agreed among all the six member nations.

"The International Monetary Fund (IMF) is a driving factor as the whole GCC VAT is an IMF initiative. The GCC could increase VAT rate but we don't know when. But it cannot be unilateral," he said. Read more...

 

Saudi Arabia's 'sin tax' on sugary drinks will come into force from December

Saudi Arabia will start levying the new excise tax on drinks containing added sugar before the end of this year, as the kingdom, the biggest Arab economy, continues to diversify its revenue streams.

The kingdom, Opec's top oil producer and the biggest crude exporter int he world, said in May it would impose a 100 per cent tax on electronic cigarettes and a 50 per cent levy on drinks with added sugar, broadening the excise duty on similar products as it looks to expand its revenue base and cut its reliance on oil income. The latest statement from Gazt did not confirm if the tax would also be implemented on e-cigarettes from the same date. Read more...

 

Abu Dhabi's Adnec secures VAT waiver for UAE exhibitors

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Abu Dhabi National Exhibitions Company (Adnec) has announced that it has obtained FTA licence for waiver from VAT for all international companies and organisations participating in or holding shows and conferences at its venues across the UAE.

The VAT waiver covers exhibitions and conferences held over a period not exceeding seven days, Adnec said in a statement.

It added that the waiver also stipulates that recipients shall not have a permanent base or established business in UAE and shall not be registered or obliged to register in UAE as per the UAE VAT Law. Read more...

 

Oman to impose 100% tax on tobacco, alcohol starting next week

Oman will introduce 100% tax on tobacco, alcohol and pork meat from June 15, as the sultanate follows other Gulf governments in trying to pare its reliance on oil revenue.

Energy drinks will also be subject to a 100% levy and there will be a 50% tax on carbonated drinks, according to the Secretariat General for Taxation website.

The new taxes could generate about 100 million Omani rial ($260 million) annually, Saleh bin Said Masan, head of the economic and financial committee at the Shura Council, said in November. Read more...

 

UAE says processing over 8,000 VAT refunds per day

The United Arab Emirates Federal Tax Authority (FTA) processes around 8,110 refunds per day on value added-tax (VAT) paid on goods and services bought in the country, it was announced on Wednesday.

The UAE, along with Saudi Arabia, introduced VAT on January 1, 2018, as part of the region’s bid to diversify its revenue streams away from hydrocarbons. Last year, the FTA announced that the Tax Refunds for Tourists schemes, which allows tourists to claim a refund on VAT paid on goods bought during their visit, will be rolled out to all UAE airports and ports and to around more than 4,500 retailers across the country. Read more...

 

FTA applies penalties for digital tax evasion on cigarettes

Penalties for not implementing the new digital tax stamp scheme on tobacco products include fines of Dh20,000 to more than Dh50,000, the Federal Tax Authority said on Saturday.

A ban on the import of any type of cigarettes into the UAE not bearing the digital tax stamps came into effect on May 1. The sale, importation or production of tobacco products not bearing the digital tax marks will be prohibited in the UAE as of August. Read more...

 

UAE marks 500 successful days of value-added tax

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As the Federal Tax Authority, FTA, marks 500 days of the Value Added Tax, VAT, in the UAE, Khalid Ali Al Bustani, Director-General of the FTA, revealed that the rates of compliance with tax laws and procedures have increased exponentially among all taxable businesses.

The tax came into effect on January 1, 2018, at a rate of five percent on the supply of most goods and services. Read more...

 

Saudi Arabia to impose excise tax on e-cigarettes and sugary drinks

Saudi Arabia will impose a 100 per cent tax on electronic cigarettes and a 50 per cent levy on some sugary drinks, broadening the excise duty on similar products enforced in June 2017.

The Arab world's largest economy already has a 100 per cent excise duty on cigarettes and tobacco products, and a 50 per cent on energy drinks. Read more...

 

IMF urges Saudi Arabia to mull VAT rate increase 

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Economic reforms in Saudi Arabia have started to yield positive results, with non-oil growth picking up and female labour force participation and employment increasing, according to the International Monetary Fund (IMF).

The IMF hailed the successful introduction of value-added tax, saying it has underpinned an increase in non-oil fiscal revenues. Read more...

 

Emirates NBD sees UAE rate climb reversing on tax giveaway

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An “unsustainable” increase in the United Arab Emirates’ lending benchmark will reverse once the government doles out the tax revenue whose withdrawal from deposits spurred the rise, according to the biggest bank in Dubai.

The three-month Eibor has climbed in the past three weeks despite a decline in a similar dollar rate, an oddity because the dirham is pegged to the US currency. Read more...

 

Who can claim a VAT refund as business visitors?

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Federal Tax Authority (FTA) has laid down clear procedures on who can claim VAT refund under business visitors’ category.

Tax consultants said these refunds will be a big relief to many business sectors such as exhibitions and conferences that will now be able to claim refund on their purchases here. Read more...

 

UAE considers adding more 'harmful' products to excise tax list

The UAE is mulling the inclusion of new products on its excise tax list, according to a statement by the Ministry of Finance, which implemented the fee on three categories in October 2017.

The ministry is conducting a joint study with officials in Saudi Arabia “on the addition of new goods to the selective tax list, as well as to determine tax rates on certain harmful substances,” its statement said.

While it did not share details of the goods it is considering to add to the tax list, it said in 2017 that it aims to reduce the consumption of harmful substances. Read more...

 

UAE's FTA sees more businesses registering for taxes in 2019

The number of UAE businesses registering for taxation in 2019 is set to grow from levels previously seen in 2018 as more companies become tax compliant, the head of the Federal Tax Authority said.

The Emirates introduced a 5 per cent VAT in January last year, and in 2017, it rolled out an excise tax on fizzy and energy drinks and tobacco, to diversify income and create new revenue streams as part of a plan to lower dependence on oil revenues. The International Monetary Fund estimates the introduction of VAT in the Arabian Gulf region could generate between 1.5 to 3 per cent of non-oil GDP in new revenue. Read more...

 

Business visitors to get VAT refund from April

The Federal Tax Authority has completed preparations to launch the "VAT refunds for business visitors scheme" from April 2.

"The scheme aims to reciprocate the efforts made in countries that offer VAT refunds to visiting UAE businesses," the FTA said in a statement.

To be eligible for the VAT refund, the first condition is that foreign businesses must not have a place of establishment or fixed establishment in the UAE or in any of the VAT-implementing GCC states. Read more...

 

Over 300,000 businesses now registered for VAT in the UAE

More than 300,000 businesses have now registered for VAT in the UAE, according to the Federal Tax Authority (FTA).

It also confirmed the success of the VAT refund procedures for Emiratis building new homes, with 235 applications approved, enabling citizens to recover a total of AED9.76 million. Read more...

 

VAT refunds for pavilions at Expo 2020 Dubai

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Countries and inter-government agencies will be able to claim value-added tax (VAT) refunds for the costs incurred for the developments of pavilions at Expo 2020 Dubai.

According to a Cabinet decision posted on the Federal Tax Authority's (FTA) website, the commercial space should be less than 20 per cent of the space to be entitled for the refund. The Expo 2020 Bureau will largely administer this process.  Read more...

 

UAE to ban sales of unmarked tobacco products from August 1

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The Federal Tax Authority (FTA) has announced that the selling or distribution of unmarked tobacco products will be prohibited across all local markets as of August 1.

The authority said that it has held a series of training workshops to introduce inspectors across the UAE's economic development departments to the Marking Tobacco and Tobacco Products Scheme, which went into effect in January.

The new scheme includes electronic monitoring of all kinds of imported, produced and locally traded cigarettes, from production to consumer, to ensure compliance with excise tax payments.  Read more...

 

Could blockchain transform the GCC's VAT system?

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With the introduction of VAT in the Middle East (UAE, Saudi in 2018 and Bahrain in 2019), the governments had a clean sheet to work with.

From e-registration to manual e-filing, they’ve introduced a lot of technology in a very short amount of time. Companies also had to adapt very quickly and both parties are just beginning their journey of tax and revenue automation.  Read more...

 

Why taxes on trucks should be reviewed

Individual emirates in the UAE have imposed toll taxes on trucks over the last few months and the federal government should look into as it could hamper the industry and investment into the country, an industry executive from the cement manufacturing industry urged.

"In the last couple of months, individual emirates have started toll charges for entry and exist of trucks. Emirates like Fujairah and Ras Al Khaimah have a toll of Dh300 for any truck moving out of the emirate. Similarly, Sharjah followed and started charging Dh420 for an entry of trucks in the emirate," said Pramod Rajgaria, chief executive officer of Star Cement. Read more...

 

Dubai Refreshment Co's 2018 profits drop 54% after VAT, excise tax

The implementation of value-added tax (VAT) and excise tax amounted to 60 percent of the Dubai Refreshment Company’s net local revenue and led to higher consumer prices, according to a statement to shareholders posted to the Dubai Financial Market.

In the statement, Dubai Refreshment Company, which is the sole bottler and distributor for PepsiCo in the UAE, said that the company “was forced to pass these taxes to the consumer”.

“This happened at a time when other sugary non-carbonated drinks were not subject to the excise tax and as such did not need to increase their prices,” the statement added. Read more...

 

IMF says VAT launch in Bahrain a 'significant step'

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Economic activity in Bahrain was subdued in 2018 and is expected to remain at about 1.8 percent this year, according to the International Monetary Fund (IMF).

The IMF described the introduction of value added tax (VAT) in January as "a particularly significant step", as are plans for cost recovery in utilities and further means-tested subsidy reforms.

It added that the Fiscal Balance Program (FBP), accompanied by $10 billion in regional support, marks a major step in Bahrain’s reform agenda and has alleviated near-term financing constraints.  Read more...

 

Food delivery? VAT compliance should be on the menu

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Getting food at your doorstep using technology could have never been imagined until the tech giants like Uber, Zomato and more recently Talabat and Careem have made it possible. Simply using fingers on customer friendly apps, one can now conveniently anytime during the day order food that will be delivered to your office or home.

Online food delivery apps typically work on the aggregator model where various restaurants are aggregated on the digital platform that allows customers to choose the restaurant and place the order.  Read more...

 

No VAT charges on bank interest or dividends

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Passively earned interest from bank deposits or dividend income cannot have VAT applied, the UAE Federal Tax Authority said on Tuesday.

The government body said the income was “outside the scope of VAT”, as it issued a public clarification on bank interest and dividends in a bid to educate taxpayers on all technical issues concerning taxes.

Khalid Al Bustani, the FTA’s director general said the Public Clarifications service, offered through the authority’s official website, “helps raise tax awareness among businesses and consumers alike, promoting compliance in the process”. Read more...

 

Lower VAT threshold to increase taxpayer base by 150.000 in Saudi - KPMG

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The reduction of the value-added tax (VAT) registration threshold in Saudi Arabia to SAR375,000 ($99,960) is estimated to increase the taxpayer base by 150,000, according to KPMG Al Fozan and Partners.

The kingdom introduced the 5 per cent VAT rate on January 1, 2018 but it only applied to businesses with revenues exceeding SAR1m ($266,560) in its first year.

From January 1, 2019 those with revenues of between SAR375,000 and SAR1m have also been subject to the tax. Read more...

 

First year of VAT in the UAE: FTA reveals the key details of implementation

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A total of 296,000 businesses have registered for value added tax (VAT) in its first year of implementation in the UAE, the Federal Tax Authority (FTA) has revealed.

The UAE implemented 5 per cent VAT on the supply of most goods and services in the country on January 1, 2018. Read more...

 

FTA set to mark tobacco products in UAE from January 1

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The Federal Tax Authority (FTA) has announced the completion of all preparations required to implement its 'Marking Tobacco and Tobacco Products' scheme.

Entering into effect on Tuesday, January 1, 2019, the scheme involves the electronic monitoring of all types of imported, produced and locally-traded cigarettes, from production to consumer, to ensure full compliance with payment of excise tax. It will be gradually extended to cover all tobacco products.
 Read more...

 

Taxpayers in UAE and Saudi Arabia: get ready for official tax audits in 2019

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Taxpayers in the UAE and Saudi Arabia will have to brace themselves for official audits next year as the roll-out of the 5 per cent VAT since January 1 this year overcomes a number of hurdles and teething problems.

Now that regulations are in place, taxpayers are expected to prepare for audits by the UAE’s Federal Tax Authority and Saudi Arabia’s General Authority of Zakat and Tax next year. It is an exercise that will test their resources and the accuracy of record keeping as well as the filing of tax returns. Read more...

 

Bahrain oil products to be VAT-exempt

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Bahrain will exclude oil products from a value-added tax (VAT) due to be implemented next year, part of an essential goods exclusion from the tax, Oil Minister Sheikh Mohammed bin Khalifa Al-Khalifa said on Tuesday in remarks carried by the state news agency.

Bahrain's upper house gave final approval to a draft law of the tax in October.
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UAE tourists praise tax refund scheme

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The inspection tours conducted by the Federal Tax Authority (FTA) have revealed that customer satisfaction with the Tax Refunds for Tourists Scheme's electronic system is on the rise.

The authority had launched the scheme in two consecutive phases beginning on November 18, 2018, in collaboration with global systems operator Planet, covering, so far, 12 ports of entry to the UAE, comprising six airports, two sea ports, and four land ports. Read more...

 

Three down, three to go in the GCC as Bahrain set to roll out VAT

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Following the decision of the UAE and Saudi Arabia to introduce VAT, Bahrain will bring the tax in on January 1 next year, leaving Oman, Kuwait and Qatar still to do so.

At the time of writing, Bahrain's primary legislation has been in circulation for a few months (in Arabic). However, the more detailed regulations remain unseen, making it difficult for businesses that need to prepare to do so. Read more...

 

UAE says $250k tourist tax refunds processed every day

The UAE is seeing an average of 3,800 transactions per day under its recently launched Tax Refunds for Tourists Scheme, it has been announced.

The Federal Tax Authority said the average total amount of refunds processed every day has so far totalled AED925,187 ($251,868). Read more...

 

Tourists claiming UAE VAT refund may be subject to secondary checks, says operator

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Tourist visitors will be able to claim tax refunds on their purchases within minutes as part of a new digital system for the Tax Refunds for Tourists Scheme – but may be subject to secondary checks as they exit the country, the company hired to operate the digital system for the UAE’s Tax Refunds for Tourists Scheme has said. Read more...

 

UAE businesses told to keep tax data confidential

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The Federal Tax Authority (FTA) has called on businesses registered for tax purposes not to disclose their financial or tax data to any person or organisation that is not officially authorised to deal with such data.

The authority stressed in a statement issued on Saturday that it is necessary to remain vigilant about messages received via e-mail or mobile phone and not to share tax registration numbers (TRN) or financial account numbers with any entity.
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New biannual tax return commences next month in UAE

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The Federal Tax Authority (FTA) will introduce a new biannual tax period next month for certain sectors, said Khalid Ali Al Bustani, director-general, FTA.

"Next November, a new biannual tax period will be introduced for some small businesses, commercial real estate owners, and board members, and they will be informed of the procedures for their new tax periods," said Al Bustani. Read more...

 

UAE records strongest excise tax compliance

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The Federal Tax Authority (FTA) on Saturday said the UAE registered one of the highest compliance rates of 97.7 per cent for tax returns requirements of excise tax.

Revealing figures at the completion of one-year of imposition of excise tax, the FTA said 715 companies had registered for the tax returns. Read more...

 

VAT refund process simplified for Emiratis

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Khalid Ali Al Bustani, director-general of the Federal Tax Authority (FTA), has announced that procedures to reclaim value-added tax (VAT) for UAE nationals who are building new residences have been simplified with electronic procedures. Read more...

 

 

Bahrain's parliament approves draft VAT law

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Bahraini legislators approved a draft law on Sunday that would see value-added tax (VAT) imposed for the first time in the kingdom, state news agency BNA reported.

The House of Representatives approved a Gulf Arab agreement to introduce VAT after a royal decree ordered parliament to hold an extraordinary session on Sunday, BNA reported, without giving details of the vote. Read more...

 

The UAE Explained: Can tourists claim their tax back?

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It is nine months since the UAE introduced VAT, and the good news for tourists is that they will soon be able to claim it back. But how?

Here is a guide to everything you need to know about the VAT process for non-residents:

- When will tourists be able to claim back VAT on their purchases?

An “advanced integrated digital system” to refund VAT to non-residents is under process and will be operational from November 18.

- Will all tourists in the UAE be able to claim their VAT back?

The only exceptions will be residents of other Gulf Cooperation Council countries: Saudi Arabia, Kuwait, Bahrain, Oman and Qatar. Read more...

 

VAT diversifies UAE government revenues with minimum rise in prices

Introduction of value added tax in the UAE has diversified the government revenues enhancing the country's institutional capacity to respond to the oil price shock while limiting inflationary impact to the minimum, said credit rating agency Moody's.

Of the six Gulf Cooperation Council (GCC) states, only Saudi Arabia has introduced the tax on schedule along with the UAE. While the VAT is at a uniform rate of 5 per cent, the level of tax compliance will be clear only when the revenue receipts are announced. Reports suggest that around 260,000-275,000 of an estimated 350,000 companies have registered for VAT so far. Read more...

 

After gold, this sector may get VAT exemption

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Following UAE's decision to exempt gold and precious metals from the value-added tax, the maritime industry could also get a relief as the Federal Transport Authority is negotiating VAT exemption with the Federal Tax Authority, confirmed a senior official on Monday.

Hessa Al Malek, executive director of maritime transport at UAE's Federal Transport Authority, said the meeting with the Federal Tax Authority will be held soon to discuss the issue. Read more...

 

Tourists in UAE won't get retrospective VAT refund

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Tourists in the UAE are unlikely to get VAT refunds for purchases made before the refund scheme comes into effect from November 2018, according to UAE-based tax experts.

They say that as per Article (68) of Cabinet Decision (52) on Executive Regulations, the Cabinet may issue a decision on introducing tax refunds for tourists, specifying the date from which the scheme comes into effect. Read more...

 

Tax Planning vs. Tax Evasion

Tax planning is the restructuring of activities in a way to maximise the tax benefits by making best possible use of all the legal options like setting up a new company in free zones, focussing on local purchases, and so on. 

On the contrary, tax evasion is a technique of refraining from tax liability with the intention of defeating the fundamental motive of the legislature. Read more...

 

VAT will attract more global investors to UAE realty

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When value-added tax (VAT) was introduced in the UAE and Saudi Arabia on January 1, 2018, initially stakeholders were wary on the potential impact of the new tax policy on the economy. 

A study conducted by Alliance Business Centers Network said that the UAE would be least affected by the imposition of VAT because it is one of the lowest globally compared to countries such as the UK, Switzerland, Germany, Mexico, South Africa and Australia. The study revealed that the VAT in UK and France was 20 per cent, which is substantially higher than the five per cent implemented in the UAE and Saudi Arabia. Read more...

 

Nearly fifth of Saudi retailers not complying with VAT, GAZT inspection finds

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A Saudi inspection campaign has led to the discovery of 323 value-added tax (VAT) violations by the General Authority for Zakat and Tax (GAZT) in the retail industry, according to local media reports.

According to Arab News, the campaign was designed to ensure that mobile phones, electronic centres and shops in the kingdom comply with the VAT system, and targeted 1,876 locations across the country. Read more...

 

Don't let UAE cashiers round up numbers for you

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Do not accept "rounding up". If the cashier cannot give you exact change, or close to it, make them "round down". It is your money. Moreover, all the other wheat stalks in the line behind you will thank you for it, and they will demand the same.

Always ask for a VAT invoice, which shows a Tax Registration Number (TRN) whenever you are being charged VAT. Chances are, the seller may not be registered. Which, by the way, is punishable by fine and imprisoment. Read more...

 

VAT in Saudi

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When Value Added Tax (VAT) was introduced in the UAE and Saudi Arabia on January 1, 2018, initially stakeholders were wary on the potential impact of the new tax policy on the economy. While a study by Alliance Business Centers Network revealed that the UAE will be least affected by the imposition of VAT, the introduction of VAT in Saudi Arabia is changing the market dynamics and bringing more transparency to the sector. Read more...

 

Are free zones in a bind?

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Following the UAE government's decision to authorise 100 per cent foreign ownership in the mainland, free zones in the UAE will have to come up with novel ideas, reasons and incentives to convince existing firms to continue their operations in the free zones as well as attract more firms, officials and analysts said. Read more...

 

Investors with commercial realty need to clear VAT dues

Investors must clear their VAT dues on the sale or rental of commercial properties before proceeding with any transfer of ownership. Read more...

 

UAE banks now able to charge VAT on fees

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Banks have started charging VAT on various services offered, following a June circular from the Central Bank of UAE, which rescinded a previous notice to the contrary. Read more...

 

 

FTA enhances e-Services for custom clearance firms

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The Federal Tax Authority (FTA) has announced enhanced features of its e-Services to facilitate customs clearance companies with easier registration procedures and submission of tax returns. Read more...

 

 

UAE signs Agreement for the Avoidance of Double Taxation and Prevention of Tax Evasion with Saudi Arabia

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The UAE, represented by the Ministry of Finance (MoF), signed an agreement for the Avoidance of Double Taxation and Prevention of Tax Evasion with respect to taxes on income and capital, with Saudi Arabia yesterday. Read more...

 

 

UAE's VAT taxpayers can appoint agents via government website

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UAE taxpayers can now connect directly with accredited tax agents – including accountants, lawyers or consultants – via a

 

 

UAE Exchange now authorised to accept VAT payments

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Money transfer company UAE Exchange has announced that it has now been authorised to start accepting value added tax (VAT) payments on behalf of the Federal Tax Authority (FTA) in the country. Read more...

 

 

All you need to know about VAT on gold and diamonds in UAE

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The Federal Tax Authority (FTA) on Wednesday clarified that the new Cabinet decision issued about VAT reverse charge mechanism for the gold and diamond industry will only pertain to commercial transactions between registered dealers. Read more...

 

 

Removing jewellery from the VAT regime may change the UAE's tax future

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The UAE Cabinet made a seemingly minor change earlier this month in how VAT applies to jewellery sales. It is significant for the way in which the VAT system will hold together in the GCC. It may even define the future of VAT in the UAE and the GCC for the next decade. Read more...

 

Kuwait to delay VAT implementation until 2021

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Kuwait is set to delay its implementation of a regional 5 per cent value added tax until 2021, according to parliamentary committee statement. Read more...

 

 

New system launched to detect tax dodgers

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The Federal Tax Authority (FTA) has announced launching a new electronic tracking system which uses digital tax stamps to ensure excise tax on tobacco products has been paid. Read more...

 

 

Up to 75,000 UAE firms facing fines for failing to register for VAT

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Almost 75,000 UAE companies are facing potential fines and other punishments from the government having still not registered for a new value added tax (VAT).The 5 per cent tax rate came into force on January 1 and applies to most goods and services. Read more...

 

 

Beware: FTA to get tough on VAT evaders in UAE

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The Federal Tax Authority will get tough on companies, which are obliged to register for value-added tax (VAT) but have not done so from next month, said a senior official. Read more...

 

 

UAE achieves '98.8 per cent VAT compliance': Federal Tax Authority

Nearly 100 per cent of companies in the UAE that were obliged to pay value added tax (VAT) have since registered to do so, according to Khalid Al Bustani, director general of the Federal Tax Authority (FTA). Read more...

 

Over half of UAE SMEs unprepared to file proper VAT returns

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Small and medium enterprises (SMEs) are still facing a lot of challenges as the first deadline for value added tax filing returns approaches, with more than 50 per cent of them still not ready to accurately file the returns, according to tax experts. Read more...

 

 

How VAT is driving digital transformation

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Tax authorities in the GCC are starting to use sophisticated digital platforms that require taxpayers to submit data in real time or near-real time, prompting companies in the GCC to enhance their digital capabilities. Read more...

 

 

UAE banks may hike fees to offset additional VAT costs

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As banks in the UAE grapple with the new value-added tax (VAT) regime and the high compliance costs associated with mandatory tax registration, it is likely that they follow international trends by increasing their fees to compensate for the additional costs, banking analysts said. Read more...

 

UAE nationals can claim VAT refund on home construction 

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Emirati house owners have the right to a five per cent value added tax (VAT) refund when constructing their homes, the Federal Tax Authority (FTA) has stated. Read more...

 

 

What are the regulatory challenges for businesses in UAE, Saudi?

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Value added tax (VAT) implementation has been a considerable challenge for most businesses in the UAE and KSA, where compliance with taxes is not common. VAT represents the most comprehensive and transformative regulatory requirement that business has had to take on. Read more...

 

Here are 3 easy steps for VAT registration in UAE 

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The Federal Tax Authority (FTA) said a taxable person or an official representative can register for value-added tax (VAT) in 3 easy steps through its website, taking no longer than 15 to 20 minutes. Read more...

 

 

Companies may struggle to file accurate VAT returns, experts say

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UAE companies filing their first VAT returns will need to account for a number of variables that range from record keeping over the coming five years to making sure they don’t under claim the tariffs they collected, experts said.  Read more...

 

 

VAT inspectors scanning hundreds of products to catch out retailers that 'manipulate' prices

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Consumer affairs inspectors are scanning hundreds of products every day to catch out retailers trying to use VAT as an excuse to "manipulate" prices, the Minister of Economy has said.  Read more...

 

 

VAT recovery in the UAE is another thorn in the process of reclaiming the tax

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The introduction of VAT in the UAE and Saudi Arabia will have implications for conference and event businesses, as companies not registered for the tax in both countries will pay the levy when they hold events, according to a VAT recovery firm.  Read more...

 

 

No VAT, excise tax increase over next five years in UAE 

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The UAE has ruled out increasing value-added tax (VAT) and excise tax over the next five years, said Obaid Al Tayer, UAE's Minister of State for Financial Affairs. Read more...

 

 

 

VAT compliance a challenge for UAE firms, experts say

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Businesses are struggling to comply with VAT, with a significant number not yet registered, even as the Federal Tax Authority (FTA) waives penalties for late registration and extends deadlines for filing tax returns for some companies, experts say. Read more...

 

 

No VAT on realty transactions in designated zones in UAE

altSale and lease of both commercial and residential properties in designated zones will be outside the scope of VAT, according to the latest clarification issued by the Federal Tax Authority (FTA) at a meeting with a group of tax consultants in the UAE. Read more...

 

 

Constructions firms should be wary of VAT-related cashflow issues

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Suppliers need to take proactive measures to protect themselves from cashflow issues in the wake of the implementation of value-added tax (VAT), according to a UAE-based construction expert. Read more...

 

 

Some GCC countries could double VAT to 10%: Report

altSome GCC countries could double VAT rate to 10 per cent mainly due to discrepancy between five per cent statutory and effective tax rate, says a new study released on Sunday. Read more...

 

 

No VAT on exports: Saudi tax authority

altThe General Authority of Zakat and Tax (GAZT) clarified that Saudi Arabian exports are zero-rated under the VAT Law and Implementing Regulations. Read more...

 

 

Free zone: no legal basis for companies refusing to work with freelancers over VAT 

Businesses have no legal basis to refuse to work with freelancers that are not registered for VAT.

That was the assessment of one free zone as it responded to reports that companies are telling self-employed individuals they won't work with them unless they have a VAT registration number. Read more...

 

VAT in UAE: New online calculator to check authenticity of tax invoice

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The Federal Tax Authority (FTA) on Tuesday launched a Tax Registration Number (TRN) verification service on its website, where consumers can check the authenticity of tax invoices and ensure that the merchants and service providers issuing them are registered with the FTA. Read more...

 

 

How VAT affects your insurance spending

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As you are aware, value-added tax (VAT) implemented in the UAE on January 1. This means, as a consumer, the majority of your purchases have five per cent added to the price. Read more...

 

 

 
Ask the Law: Bounced cheques and related laws in the UAE

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Here's what we learnt about bounced cheques in the UAE from readers' questions in Ask the Law. Read more...

 

 

 

 

How VAT affects car owners and sellers in the UAE

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How much you pay to buy a new or second-hand car depends on whether you are buying from an agency, dealer or individual, according to a new guide for drivers released by ServiceMarket.com and CarSwitch.com. Read more...

 

 

 

10 important things you need to know about VAT in UAE

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Here's a rundown of what you need to know about VAT - from what products and services are subject to it to knowing whether companies are trying to pull a fast one on youRead more...

 

 

VAT in UAE offers new opportunity for banks
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The introduction of value-added tax (VAT) in 2018 would mark the beginning of a new era in the economic diversification of the UAE. In the past four decades, the UAE has seen a massive economic transformation from an oil based economy to a well-diversified economy compared to its peers. The GDP of the country went up from a mere $14 billion in 1975 to over $380 billion supported by the growth in oil and non-oil sectors. As a result of the diversification efforts initiated two decades back, oil sector now just accounts for around 30 per cent of the total GDP. Read more...

 

Is your grocery illegally charging VAT? Find out here

The invoice should include the seller's tax registration number (TRN) and the amount of VAT charged. No TRN, no VAT. Read more...

 

UAE Ministry of Finance approves first purchase invoice with VAT

altFollowing its commitment to the UAE's various government finance procedures, laws and regulations; the Ministry of Finance (MoF) has today issued the first VAT inclusive purchase order, and approved the first VAT invoice on its federal financial system. In light of such activity MOF became the first federal entity to implement tax procedures and issue a tax invoice in 2018Read more...

 
 
 
Small corner shops must comply with VAT law: Al Bustani 

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Khalid Al Bustani, Director General of the Federal Tax Authority (FTA), said that all retailers must update all their prices in time for the VAT kick off on January 1. Read more... 

 

 
Family businesses expected to face VAT compliance challenges

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Family businesses across the GCC are likely to face tax compliance challenges as Value Added Tax (VAT) is being introduced in the region starting with the UAE and Saudi Arabia from January 1, 2018. Read more...

 
 
 
 
All you need to know about registering for VAT? 

According to the executive regulations on value added tax (VAT) published last week, the mandatory registration threshold is Dh375,000. Read more...

 
 
 
Guide: How VAT will impact education sector in UAE  

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Implemented across more than 150 countries worldwide, the UAE's 5% VAT is among the lowest in the world. Read more...

 
 
 
Brokers no longer allowed to sign rental contracts

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Brokers legally appointed to manage property of landlords based abroad are no longer allowed to sign unified lease contracts to get an Ejari. Read more...

 
 
 
 
Move on bounced cheques to boost investor confidence

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The decision by Dubai Courts to issue fines instead of jail sentences for bounced cheques will help instill confidence among the business community and ensure that those in debt can resolve their issues, Hamad Buamim, president and CEO of Dubai Chamber of Commerce and Industry, said on Monday.  Read more...

 

Two VAT-specific deadlines for owners of commercial properties

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One, they will need to register with the Federal Tax Authority if the sales or rental proceeds exceeded Dh375,000 in the previous 12 months. And, two, if the owners believe they are likely to generate more than Dh375,000 over the next 30 days. Read more...

 
 
 
 
 
If VAT induces a fear of buying, try leasing a car

If the cost of buying a new car is a worry, then give leasing it a shot. UAE dealerships are all set to upgrade – or update - their financial leasing services to try and ease the reluctance of buyers over the higher costs they will have to bear after VAT’s implementation. Read more...

 
 
VAT in the UAE: 10 things to know

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The Federal Tax Authority (FTA) has announced a list of the top ten things businesses must know before registering for VAT, in order to raise awareness within the business community, as well as society at large. Read more...

 
 
 

Passengers at Dubai airports to pay excise tax

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Dubai Duty Free (DDF) confirmed on Monday that both departing and arriving passengers at Dubai’s airports will pay an excise tax on carbonated drinks and energy drinks in line with the UAE’s implementation of the tax.

 

Zero rating and exemptions available to a number of goods

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Zero-rating of value added tax applies when goods and services are being exported to outside a VAT-implementing GCC state, as well as to international transportation of passengers or goods including a transfer starting or ending in the UAE or passing through its territory

 

Who will bear the burden of VAT in the UAE?

altLess than three months to go until VAT is introduced in the UAE and the sense is that most businesses remain woefully unprepared, and the effect on the wider economy remains unclear. The UAE government is anticipating significant – and much needed – revenues but who is likely to pay the economic cost of VAT?

 

Saudi businesses with revenue exceeding SAR375,000 to pay VAT from Jan

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Saudi Arabia’s General Authority for Zakat and Tax has announced that private sector companies with annual revenue exceeding SAR375,000 ($100,000) will pay monthly value added tax from January 2018, according to reports.

 

VAT and its implications in the GCC

altWith the new economic reform of adding value-added tax (VAT) in the Gulf Cooperation Council (GCC) coming into effect in January 2018, many are concerned about its implications. 

 

Federal Tax Authority clarifies price-setting mechanism for Excise Tax

Following the introduction of Excise Tax in the UAE on October 1, the Federal Tax Authority (FTA) has clarified that the Excise Goods Price List that is downloadable from its website is a reference for tax calculation only, and not for setting retail prices.

 

UAE Cabinet Approves Decisions No. (39) and (40) for 2017 on Federal Tax Authority's Service Fees, Administrative Fines

altThe UAE Council of Ministers has adopted Cabinet Decision No. (39) of 2017 on Fees for Services Provided by the Federal Tax Authority and Cabinet Resolution No. (40) of 2017 on Administrative Penalties for Violations of Tax Laws in the UAE.

 

altThe planned Excise Tax is set to go into effect at the beginning of October 2017, announced the Federal Tax Authority (FTA) at a press conference in Dubai today (Wednesday, September 27, 2017). 

 

President issues VAT Decree Law

The UAE will mark the beginning of new era in its 46-year history on Sunday as it starts implementing excise tax, exactly three months ahead of the launch of value added tax (VAT), another landmark region-wide tax initiative. 

 

Federal Tax Authority debuts website to help businesses navigate UAE's new Tax system

altThe Federal Tax Authority (FTA) has launched its website, providing businesses and consumers with a wealth of information on the upcoming introduction of excise tax and VAT in the UAE.  

 

UAE President issues Excise Decree-Law targetting select 'harmful' products 

President issues new Tax Procedures Law

UAE Federal National Council passes draft on tax-related law

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