Sales Tax in Dubai, UAE
The UAE is constantly looking for the ways to further diversify the economy of the state. While major taxes are not imposed by the government, there are still some ways of indirect taxation. Travellers and businessmen who come to the UAE and Dubai are often willing to know whether there is sales tax in UAE and other types of minor taxation.
A sales tax is a tax imposed by the government of the state on goods and services. Typically, it is collected at the point of sale. What’s the situation concerning sales tax in Dubai like? Let’s discuss it in more detail in the next part of the article.
Is there sales tax in Dubai?
The answer to this question is “yes.” Dubai sales tax is in force from January 1, 2018 along with the introduction of VAT. Sales tax is paid by the end consumers and its rate comprises 5%.
The UAE sales tax influences the total price of goods and services provided. Due to its availability, shopping is more expensive, but since its rate is rather low, it has reasonable impact on consumers. Besides, there are items exempted of sales tax in Dubai. They are mainly related to healthcare and education areas and include other essentials. Dubai sales tax, however, is imposed on electronics, home appliances, furniture and other non-essentials.
What does it mean for tourists?
Goods purchased in the UAE by travelers, if purchased outside of duty free, are not exempted from sales tax. The rate of sales tax in Dubai for tourists is same as for residents means 5%.
Conclusion on sales tax in Dubai
Sales tax in Dubai, is in force January 1, 2018. According to Dubai sales tax and its rates, end consumers have to pay 5% as the sales tax when purchasing goods and services in the country. It influences their total price but a number of items are exempted of sales tax. These exempted items are living essentials and certain services related to healthcare and education.