Posted on Nov 15, 2017
In UAE Excise duty was implemented from 1st October. As per the law, the business units are required to file their excise returns and pay their dues 15th of November.
The Federal Tax Authority is recommending all the business units to file excise returns and pay the dues before the deadline. The business units failing to file returns and pay dues will be liable to pay a hefty amount of the penalty.
Appreciating the compliant business entities and Urging the others to file timely returns Khalid Al Bustani, director-general of the Federal Tax Authority, said, “Since the beginning of November, businesses registered for excise tax have been consistently complying with their requirements and deadlines, filing their tax returns on time. We urge those who haven’t done so yet to file their returns before the deadline of November 15, 2017, and settle the payable tax stated in the submitted excise tax return, in order to fulfill their obligations according to the tax procedures in the UAE.”
In UAE 100% excise duty is applicable on tobacco products and energy drinks and 50% on carbonated drinks making them expensive than before.
According the rules stated by the Federal Tax Authority failure to file returns will attract the following amount of penalty
Those who fail to submit their returns on time will be subject to an automatic Dhs1,000 penalty for the first offense and Dhs2,000 if this is repeated within 24 months.
Also, taxpayers will pay a late payment penalty of two percent of the unpaid tax, which increases to four percent after seven days.
After one calendar month, a one percent daily penalty will be charged, with the fine capped at 300 percent. Incorrect tax returns can also incur a fixed penalty of Dhs3,000, as well as a percentage-based penalty of up to 50 percent of the amount unpaid.
According to the tax experts in UAE 5% VAT will not be levied on amount withdrawn from ATMs of banks other than their own bank - but only on the Dh2 fee will be charged by the banks.
Declining the news of the delay in implementation of VAT in UAE Khalid Ali Al Bustani, director general of the Federal Tax Authority, says VAT will start as planned on Jan 1 2018.
Executive Regulations for the Federal Decree-Law No. (8) of 2017 on Value Added Tax, VAT were signed and approved by the Shaikh Mohammad Bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE.