UAE has till now considered a tax-friendly nation, resulting in the establishment a lot of local and multinationals to set up their organizations here. Soon a new taxation system will be imposed on the business and customers alike in the form of Value Added Tax (VAT), confirmed by the Ministry of Finance, UAE.
VAT is an indirect tax which is imposed on goods and services, it is a consumption based tax as it is added at each stage of production and now UAE is all set to impose VAT in their system at the rate of 5% from 1st January 2018 and Other GCC countries on or before 1st Jan.’2019.
The Middle East is losing big on the oil economy. UAE has also felt the heat of it but by soon rolling out their new tax law termed under Value Added Tax (VAT), will they be able to turn down the wheel of fortune in their own favor?
Value-added tax is on advancement across the GCC and the progress so far is worth taking a note. Out of Six, Five of the GCC nations have approved the Unified Agreement for Value Added Tax and while the UAE has taken a leading role through the process, the administrative and legislative work still needs to be done across the region.
Pressure is building up for organizations in the UAE with time running out to get ready for the preparation of a 5% Value Added Tax on their goods and services, A as they have to prepare themselves for a big change.
The deadlines for the VAT registration in the UAE has been announced by the UAE Federal Tax Authority (FTA), but the more concerning question is that whether the businesses of GCC nations and UAE, in particular, are fully optimized and ready for the VAT implementation or not?
The implementation of VAT is set to be on 1 January 2018, being forced on specific goods and services. The law laid out few exemptions and zero-rated goods and services. VAT is a sort of general utilization that is gathered incrementallyand the end customer will pay the VAT.
VAT is set to make its debut in the GCC region with effect from 1st January 2018. The Ministry of Finance, UAE recently proposed the new law that allows them to impose a tax on all maximum goods and services at a standard rate of 5%, and it's called Value Added Tax (VAT).
In the below post, get to know more about VAT rates in UAE that is going to be implemented from 1st Jan, 2018.
With VAT slated to be launched in early next year, there is a speculation that it would bring a plethora of job opportunities in the region. Let’s explore how it is going to change the landscape of market in the coming future.