As the price of oil continues to fall, those nations whose gross domestic product (GDP) has relied on its revenues are being forced to diversify their economies. Naturally, the only real way to fill the void left by lost oil revenue is taxation.
But how will the implementation of value-added tax (VAT) affect you? Guides has picked through this Gulf News report and highlighted the important facts that you need to know.
1. VAT is due to be implemented at the beginning of 2018
2. When introduced, the initial rate of VAT is likely going to be between 3-5 per cent
3. Staple food items will remain exempt from VAT
4. Healthcare, education, and social services will also be exempt from VAT
5. The government forecast between Dh10 billion to Dh12 billion revenues from VAT in the first year
6. It is a crucial step in ensuring a stable economy which is less reliant on oil revenue
7. VAT will be introduced across the wider GCC region, and not just the UAE
8. The retail sector will be protected as much as possible, with price increases not being too much of a shock to middle and low income earners
