New VAT in the UAE


The beginning of 2018 saw the 5 per cent value-added tax (VAT) come into force for the United Arab Emirates. As of the 1st January this year, the VAT (also referred to as the goods and sales tax) was levied on most goods and services, particularly those classed as ‘non-essentials’.

It is the first time the UAE has introduced direct taxation and, according to Gulf News, it is expected to generate AED12 billion ($3bn USD) from tax revenue in the first year. The income will be used to provide high-quality public services and help government move towards its vision of reducing dependence on oil as a source of revenue. Countries reportedly have until January 2019 to begin implementing the tax.

There will be items exempt from the tax including certain health and education supplies. It is yet to be confirmed what impact the new tax will have on the events and tourism industry, however early reports have stated visitors to the UAE will not be exempt from paying the tax.

Working alongside our industry and government partners, Pure Arabia will be keeping all customers informed and updated on any new VAT developments and how this may affect our events and services within the UAE.

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