As 2018 is approaching, the UAE government is starting to clarify the appliance of the value added tax, as part of the agreement signed by all Gulf Cooperation Council (GCC) states. The government recently announced that air travel, school and doctor’s fees will be exempt from the VAT, in order to not burden UAE residents. Our company formation agents in Dubai can offer more information on the taxation system applicable in the UAE.
Even so, the news has scared investors a little when it was released. This is why the government has issued various statements over the last year in which clarifications about the value added tax were made. One of the latest statements announces that air travel, tuition fees and doctor’s fees will be exempt from the VAT payment.
This will have a positive impact not only on locals, but also on foreign citizens relocating to emirates like Dubai and Abu Dhabi. The government knows how many foreign investors the emirates attract every year, many of them applying for residency. It also known how sensitive the education and healthcare matters are, which is why the decision to apply a zero VAT rate on these services.
Our company incorporation consultants in Dubai can assist foreign investors who want to relocate here for doing business.
Those who want to buy properties for the first time in Dubai will also benefit from a 0% VAT, which is good news not only for the population but also for the real estate industry in the country. The buyer has the possibility of buying the property within 3 years since the construction project was started. He or she can later sell the estate with the same 0% VAT rate.
The sale of crude oil and gas will also be exempt from the VAT in the UAE, unlike other states of the GCC which do not provide for this exemption.
The decision to provide a 0% VAT on these services comes after a thorough analysis of the government which indicates there are more than 8 million foreign citizens living in the UAE who use air transportation and schooling services here.
You can rely on our company registration advisors if you want to open a company in Dubai. You can also contact us if you need accounting services in Dubai.