KHALEEJ TIMES, Thursday, May 16, 2019 | Ramadan 11, 1440
UAE marks 500 successful days of value-added tax
As the Federal Tax Authority, FTA, marks 500 days of the Value Added Tax,
VAT, in the UAE, Khalid Ali Al Bustani, Director-General of the FTA, revealed
that the rates of compliance with tax laws and procedures have increased
exponentially among all taxable businesses.
The tax came into effect on January 1, 2018, at a rate of five percent on the
supply of most goods and services.
In a press statement issued by the authority, Al Bustani added, "Compliance was
made possible through the seamless, flexible, and clear procedures the FTA has
rolled out through electronic, fully paperless systems that are among the most
advanced of their kind in the world, underpinned by a sophisticated legislative
environment that meets the highest standards in the field."
"The FTA implemented an easy-to-use system for submitting tax returns and paying
taxes via the e-Services portal, available 24/7 on the FTA's official website,"
Al Bustani said that as part of the authority's efforts to manage and collect
federal taxes, various tax refund mechanisms have been launched for legally
eligible groups to recover VAT, including the Tax Refunds for Tourists schemes,
of which nearly 8,110 transactions were processed on a daily basis.
Al Bustani also highlighted the success of the VAT Recovery on the Building of
New Residences by UAE Nationals programme by saying, "The system has received
more than 800 applications, 375 of which were approved, allowing applicants to
recover AED14.74 million in taxes incurred on the construction of their homes."
He continued, "As of April 2019, the FTA began implementing the VAT Refund
Mechanism for Visiting Foreign Businesses, receiving a number of refund requests
for taxes incurred in 2018 by foreign businesses."
Stating that the UAE's tax system has earned praise from experts and official
entities in the UAE, the region, and the world, he said, "This is evident from
the FTA's participation in the Arab Regional Tax Forum, which Dubai hosted in
March 2019, as well as its participation in April in the Belt and Road
Initiative Tax Administration Cooperation Forum in China, where it showcased the
UAE's experience with implementing tax laws."
These achievements and the tremendous progress the UAE has achieved in its tax
systems have culminated in the country being elected to serve as the Vice
Chairman of the Board of Directors of the Belt and Road Initiative Tax
Administration Organisation, he said.
Stating that the number of users who registered for VAT has exceeded 300,000
companies, individuals, and tax groups, he asserted the FTA's commitment to
maintaining continuous communication with all parties concerned with the tax
system via guides on VAT, e-learning programmes, educational short films, and
infographics, in addition to public clarifications and continuously updated
information on its website.
In terms of new campaigns, the FTA launched the tax invoice campaign in the
first quarter of 2019, to promote the use of tax invoices in all business
transactions in tandem with the "Tax Clinic" campaign launched in August 2018 to
establish direct contact with business sectors, raise tax awareness among them
and identify any obstacles they may be facing.
He also lauded the close cooperation with the Federal Customs Authority and
local customs departments in order to link their systems with the FTA's network,
which contributed to the smooth implementation of the tax system and maintenance
of the flow of foreign trade.
"The authority has spared no effort in assisting businesses to comply with tax
regulations and procedures, organising several introductory and consultation
meetings to prepare the private sector for dealing with the tax system," he said in conclusion.