increase VAT
increase VAT

The Assistant Undersecretary for Resources and Budget Affairs at the Ministry of Finance, Saeed Rashid Al-Yateem, confirmed that there are no plans or decisions at the present time to increase the value-added tax rate to 5% in the country. ...

 

This came on the occasion of the Ministry's announcement today, of total value-added tax revenues, which amounted to 11.6 billion dirhams during the period from the beginning of January to the end of August 2020, in addition to the increase in the total excise tax revenues for the state for the same period by approximately 47% compared to the same period last year at a value It amounted to about 1.9 billion dirhams.

Al-Yateem said that the value-added tax revenues were distributed at a rate of 30% to the federal government and 70% to local governments, explaining that the federal government's share of the excise tax revenue on tobacco and its products represents 45% and 55% for local governments, while the federal government's share is 30% On excise tax revenues on other excise goods such as energy drinks, soft drinks and sweetened with added sugar.

Al-Yateem added in a statement, that “tax revenues will contribute to the continued implementation of development projects in accordance with the plans targeted by the UAE government, and to mitigate the repercussions of the (Covid-19) pandemic,” noting that “the Ministry of Finance continues to follow up tax policies in coordination with the Federal Tax Authority to ensure Harmonizing them with developments in the regional and international arena, and updating legislation continuously in line with the objectives of financial policies and sustainable economic growth.

For the year 2019, the tax revenue collected amounted to about 31 billion dirhams, compared to 29 billion dirhams in 2018, where the growth rate of total tax revenues for the past year was about 7% compared to 2018.