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VAT will help wean UAE off oil, says official

VAT will help wean UAE off oil, says official

DED chairman says VAT will ensure a robust, sustainable and diversified economy

The introduction of VAT to the UAE will help develop a sustainable economy and wean the country off oil, said a senior official at the Department of Economic Development – Abu Dhabi.

Value-added tax was introduced in the emirates on January 1, with rate of 5 per cent applied to a range of items – the first time such a tax has been implemented in the UAE.

But while the move has been met with some concern by businesses and customers, DED’s chairman Saif Mohammed Al Hajiri has said that the tax will have a minimal impact on the country’s business sector, and generate a number of benefits for the economy.

“The application of VAT … will reflect positively on the country’s developmental drive as it ideally goes in harmony with the government’s vision to ensure a robust, sustainable and diversified economy to ultimately wean the country off oil in the future,” he said, according to state news agency WAM.

“The Department has ensured the development of a well thought-out strategy across the emirate of Abu Dhabi to control prices and open up channels of communication with consumers and monitor any misuse of the tax application,” he added.

Read: Revealed: Goods and services subject to VAT in the UAE

Under-secretary of the DED, Khalifa Salem Al Mansouri, said that the department has taken preemptive measure to prevent businesses abusing consumers under the pretext of VAT, and that the DED has various channels of communication with the public who wish to report violations.

“The DED inspection teams have developed a comprehensive database on all commodity prices over the last months of 2017 that will help monitor the slightest price hikes that go counter to the law across all sales outlets in the emirate,” he said.

He added that inspection campaigns will intensify during the first quarter of the new year to ensure the price rise will not exceed 5 per cent, as per the law.

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