2018 will be a landmark year for Dubai and GCC nations. Why? Because the member states of the Gulf Cooperation Council have decided to introduce value-added tax or VAT as it is popularly referred to all over the world.
Paradigm Shift –
VAT tax in the UAE has been fixed at 5%. This was recently announced by the ministry of finance. But, why has UAE abruptly decided to adopt a tax regime after remaining a tax-free zone for such a long time? Well, by introducing VAT in Dubai the government has taken a bold step towards fiscal consolidation.
This form of taxation has already been embraced by major economies of the world and today considered as one the healthiest form of revenue generation mechanism.
So, Will the VAT Tax in Dubai be Applicable to all the goods?
No! Dubai and the rest of the GCC countries have unanimously agreed to let off close to 100 food items, healthcare, educational and social services. This simply means the basic needs of citizens will not be affected in any way. However, electronic products, jewelry, cars, luxury goods, dining, and many entertainment gateways will fall under VAT.
VAT implementation in Dubai is knocking on the doors of businesses which means they have to fine-tune their books of accounts accordingly. In the first phase of VAT implementation, only a certain section of businesses will need to register. For example, companies whose revenues fall within DH 1.87 to DH 3.75 million can defer their registration under VAT for the time being.
The old charm still remains –
The old charm of Dubai in terms of tax policy still remains in certain domains. For example salaries still, remain tax-free. Businesses in some of the free zones still will continue to bask in a tax-free environment and even some of the lower earnings will find itself out of tax net. Nonetheless, business entities need to adapt to the changing times and contact VAT consultants in UAE in case their revenues exceed the stipulated figure. Business Link UAE Consultancy one of the finest VAT consultants in Dubai provides end to end solutions for businessmen and corporate.
Although VAT consultancy services in Dubai is still nascent and yet to imbibe the related requisites in its entirety there are law firms such as Business Link UAE Consultancy who because of their foresight have readied themselves for the inevitable; that is VAT implementation in UAE in general and VAT implementation in Dubai in particular.
A VAT consultant in Dubai such as Business Link UAE Consultancy provides support in the following VAT areas:
1. VAT registration services in Dubai, UAE.
2. VAT consultation services in Dubai, UAE.
3. Accounting & auditing services for small and medium-sized companies in Dubai.
Remember, time is running out, and it is always a good idea to have a head start to counter unforeseen problems. We are a renowned VAT consulting services provider in Dubai to assist and support in filing returns, arranging required tools and technologies for the same and also VAT empowered staff.