UAE President His Highness Sheikh Khalifa bin Zayed Al Nahyan has issued a decree-law on value added tax (VAT) months ahead of its implementation.
Federal Decree-Law No.8 of 2017 states that all supplies of goods and services are subject to VAT at a rate of 5 per cent.
It also defines terms, clarifies exemptions, specifies which companies need to register and outlines the process of submitting a tax return.
VAT is scheduled to take effect in the UAE in January 2018, and in the rest of the GCC over the next two years.
The UAE’s Federal Tax Authority (FTA) recently launched a website called tax.gov.ae to help businesses prepare for the introduction of both VAT and excise tax.
Last month, His Highness Sheikh Khalifa issued the landmark Federal Law No. 7 of 2017 for Tax Procedures, which sets the foundations for the planned UAE tax system.