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Abu Dhabi: Over 260,000 companies and over 10,000 groups (one or two companies in a group) have registered for value added tax since it came into effect earlier this month, director general of federal tax authority Khalid al Bustani said in Abu Dhabi on Tuesday.

“We are satisfied with the implementation of VAT registration so far. Applications of some companies are under processing and some applications have been returned because of wrong information. We are expecting to conclude the remaining registration process soon,” said Al Bustani while urging firms wih an annual turnover of more than Dh375,000 to quickly register.

“If the companies do not register they will be breaking the law,” he said without elaborating further.

He also said revenue from the value added tax will support the UAE’s GDP growth and help in the diversification process.

“The impact on individual cost of living is minimal as value added tax is just five per cent and it is about 1.4 per cent but VAT will support the economic growth and will help the economy in diversification of the revenue.”

Read more about VAT in UAE.