Dubai, 16 August: The United Arab Emirates (UAE) is preparing to make new taxes for New Year. Under this, 5 percent VAT will be applicable from January 2018. Director General of the Federal Tax Authority Khalid Ali Al Bustani said that some major changes are being made in the country’s tax system. Preparation for this has started. UAE government says that due to the low oil prices in the international market, its earnings have declined. In order to meet this shortage, the provision of VAT has been made. In addition, 100 percent excise tax on Tobacco and Energy Drinks and 50 percent extra tax on other soft drinks are also being prepared. Such food and beverages will be expensive. UAE government will implement new tax structure to fill losses due to falling oil prices.
The new tax system estimates that the government will get revenue of more than 12 billion dollars in the first year. Under this, the companies that have annual revenue of more than 3.75 million will be required to get registered under VAT. There, the companies whose revenue is between 1.87 million Dirham and 3.75 million, they will have the option to get started at the beginning of the VAT, but when the system is fully implemented all the companies will be required to register. However, even after the VAT has been applied many things will be tax-free. There is no income tax on salaries.