Finance ministry says VAT rate remains unchanged at 5 per cent

The UAE government has dismissed rumours that the rate of value-added tax (VAT) would be raised in line with Saudi Arabia’s recent decision to triple its VAT rate.

The Ministry of Finance confirmed the UAE would continue to charge 5 per cent VAT.

UAEGov

✔@uaegov

نفت وزارة المالية وجود أي خطط في الوقت الراهن لرفع ضريبة القيمة المضافة في دولة العربية المتحدة والمفروضة حالياً بنسبة 5%، مؤكدة التزامها بتحقيق مستهدفاتها وخططها التنموية المعتمدة. @MOFUAE

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Saudi Arabia’s rate of VAT will rise three-fold from 5 per cent to 15 per cent in July.

Riyadh also approved SR100bn ($27bn) of planned spending cuts to support the Saudi Arabian economy as it contends with low oil prices and Covid-19.

VAT was introduced in the UAE on 1 January 2018 and as a general consumption tax, applies to the majority of transactions related to goods and services.