The UAE’s Ministry of Finance (MoF) said that from the beginning of January until the end of August 2020,the total value-added tax (VAT) revenue amounted to AED11.6 billion ($3.15 billion).
Also, the country’s total excise tax revenue amounted to about AED1.9 billion, noting a 47% increase in comparison to the same period in 2019.
Saeed Rashid Al Yateem, Assistant Under Secretary of Resource and Budget Sector at MoF, noted that 30% of VAT revenues will be distributed to the federal government and 70% to local government.
Al Yateem said that the federal government's share of excise tax revenues on tobacco products is 45% - with 55% for local governments - and the federal government's share of the excise tax revenues on other excise goods (i.e. energy drinks, soft drinks as well as beverages sweetened with added sugar) is 30%.
“Tax revenues contribute to the continued implementation of development projects in accordance with the UAE government’s plans, and to mitigating the repercussions of the COVID-19 pandemic,” Al Yateem said.
He affirmed that there are no plans or decisions at the moment to raise VAT to more than 5% in the UAE.
The UAE began applying VAT on January 1, 2018, at a basic rate of 5 percent on most goods and services levied at each point of sale.
