United Arab Emirates, is set to implement 5% VAT from 1 Jan 2018, according to UAE Cabinet Decision (52) of 2017. All Citizenship agents offering CBI and Golden visa programs have to charge VAT to clients.
According to UAE Government, VAT will provide the UAE with a new source of income which will be continued to be utilised to provide high-quality public services. It will also help government move towards its vision of reducing dependence on oil and other hydrocarbons as a source of revenue.
VAT, as a general consumption tax, will apply to the majority of transactions in goods and services in the UAE. A limited number of exemptions may be granted. All businesses are required to register for VAT.
A business must register for VAT if their taxable supplies and imports exceed the mandatory registration threshold of AED 375,000. Furthermore, a business may choose to register for VAT voluntarily if their supplies and imports are less than the mandatory registration threshold, but exceed the voluntary registration threshold of AED 187,500.
VAT-registered businesses generally:
- must charge VAT on taxable goods or services they supply
- may reclaim any VAT they have paid on business-related goods or services
- keep a range of business records which will allow the government to check that they have got things right.
Retailers are urged not hike prices because of VAT implementation , according to Gulf News
The UAE Government, in an official statement, has reaffirmed its commitment to remove from EU list of non-cooperative jurisdictions on tax matters
The UAE’s Undersecretary of the Ministry of Finance, Younis Haji Al-Khouri, said: “The UAE has worked to meet the European Union’s requirements in terms of exchanging tax-related information.” “We have committed to a reform process which will be finalised by October 2018, and we are absolutely confident this will ensure the UAE is swiftly removed from the list. “We look forward to moving into the next phase of cooperation with our EU partners on the important issue of tax regulation.”
