Dubai: Tax refunds for tourists are expected to be finalised soon, according to the Federal Tax Authority’s top official, Khalid Al Bustani.
Al Bustani told journalists on Wednesday morning that he expected a company to be selected soon to handle tourist refunds.
“We have tender for the selection of a tourist refund operator, and we are in the final stages now. We are waiting for the final approvals in order to finalise the contract with the operator,” Al Bustani, who is director-general of the Federal Tax Authority (FTA), said.
Acknowledging the critical role that tourism plays in contributing to the country’s economy, Al Bustani said: “Tourism is important to the UAE, and we’re aware of the importance of having a tourism refund.”
He was quick to say, however, that the selection process needed to be professional and transparent.
“To have a tourist refund system, we have to be professional about how we implement this system in accordance with best practice,” Al Bustani added.
When asked for details on who the front-runner in the bidding process was, FTA spokespeople declined to comment.
Tourists visiting the UAE will be able to claim back value-added tax (VAT) on purchases they make whilst on holiday in the country, according to the FTA’s executive regulations.
The regulations do not, however, go into details on how this process would work.
However, they do state that the refund system would only be eligible to those travelling to the UAE from outside Gulf Cooperation Council (GCC) countries.
Towards the end of last year, the FTA suggested that the exact mechanism for claiming back VAT would be agreed upon and announced by the UAE’s cabinet in the following months.
According to the executive regulations, the following conditions will apply to the tax refunds for tourists scheme: The goods must be supplied to the visitor whilst he or she is in the country, at the time of purchase; the visitor must be intending to leave within 90 days of purchase; and the visitor must be from outside the GCC.
It also went on to add that the cabinet may publish a list of goods that will not be eligible for refunds.