Dubai: Most of the telecom operators’ products and services in the UAE will be subject to a five per cent value added tax (VAT) starting from January 1.
This is set to include all services consumed through mobile or fixed infrastructure and for prepaid and postpaid customers. For example, a bundle of Dh100 will become Dh105 from January 1, 2018.
There is not expected to be a heavy negative impact on consumer consumption throughout 2018.
For customers who have ongoing mobile phone contracts, prices will change in January to reflect the new prices, inclusive of VAT.
The telecommunication companies have refused to say whether or not tourists will be taxed on their roaming costs.
Both Du and Etisalat have said that further details regarding the application of VAT on products and services will be made available in the coming weeks.
According to Etisalat’s website, there is a possibility for business owners to claim back their VAT payments, provided they have registered for VAT and meet the requirements.
All Etisalat business customers who are entitled to recover their input VAT must officially submit their VAT registration details including tax registration number (TRN) with supporting evidence to Etisalat latest by December 21, 2017.