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Value Added Taxes in the United Arab Emirates

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In this article, we are going to tell you everything about paying VAT in UAE as a tourist.

This tax is levied upon all the products and services being sold and purchased in UAE. For example, if you have booked any tours or safari services through any agencies like UAE visa online, the final amount paid will also include the Value Added Tax.

This Middle Eastern country is known for its flashy lifestyle, larger than life skylines and luxurious malls. Going a little overboard with shopping is a given when one visits such a place.

However, it does not mean that the traveller has to pay a hefty amount of VAT. This is why; there is a special provision for the visitors to claim a refund of their VAT through an electronic process.

Continue reading the article further below to find out more about VAT in UAE.

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About VAT

This acronym stands for the Value Added Tax, a flat public tax. It has a lot of similarities with the well-known sales tax. However, in this case, small portions of the full tax amount are paid by all the different participants in the transactions.

When you register vat in UAE for a particular business selling either goods or services then you can claim back a portion of it with the receipts.

VAT law in the Emirates

In the United Arab Emirates, this tax is a fairly new addition to fuel the economy and for investment capital in public’s welfare. The VAT law in UAE was passed in the year 2018 and has been since set at 5%.

The main cause for levying this tax was stated to generate a new source of income for investing in public welfare and utilities. The country’s economy has been dependent on its oil and petroleum reserves for far too long.

The registration for VAT in UAE is designed to bring a shift in the economy to shift the revenue sources. You can read about this vast law in complete detail on the official website of UAE’s Federal Tax Authority.

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VAT on Tourists/Claims

The goods purchased by tourists visiting from overseas countries are considered to be exported so they are refunded through an electronic process.

Travellers can contact and discuss their exemption of VAT in UAE with their travel agents at agencies like UAE visa online. Here are some of the conditions these purchased items should fulfil:

  • The applicant should make the purchase from an authenticated seller, who is a part of the tourist VAT return scheme.
  • The person applying should have an intention to leave the country within a period of a maximum of 90 days or within three months from the supply date – whichever is earliest.
  • The entire purchase process must be done according to the authorisations by the Federal Tax Authority of the country. 

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VAT Registration

In order to claim the refunds on all your purchases in UAE as a visitor, you will first have to undergo an online registration for VAT in UAE.

For any queries about any transaction, you can contact the authorities through an enquiry form on the Federal Tax Authority website. You can also call on the helpline numbers - 600 599 994 or 04-7775777.

Additionally, you can also contact the tax authorities via your travel agency, who will help you with the same.

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Frequently Asked Questions

Ever since its introduction in the year 2018, the rate of VAT in UAE has been 5%. It is levied on almost all domestic goods and services with the exception of some.

The country has a system that electronically integrates the tax recovery. All the tourists and visitors who have purchased something from the country can claim a refund at the time of returning.

There is a standard method of calculating the amount for those who have a business registration for VAT in UAE, which is done on the final invoice or sale price.

Yes, if you have made any bookings from UAE visa online or any other such reputable travel agencies then a standard rate of VAT will be levied on the domestic tourism services.

There is a long list of requirements that people who want to claim an exception must fulfil. In a broad sense, exemptions on VAT in UAE law apply to some financial service providers, buildings being constructed for residence purposes, certain land sales etc.

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