Al Maliah: 11.6 billion dirhams of total value-added tax revenues during the period from January to August 2020

Today, the Ministry of Finance announced the total revenue of value-added tax, which amounted to 11.6 billion dirhams, during the period from the beginning of January to the end of August 2020, and the ministry also announced that the total revenue of excise tax for the state for the same period increased by approximately 47% compared to the same period in In 2019, with a value of about 1.9 billion dirhams.

Commenting on this, the Assistant Undersecretary for Resources and Budget Affairs Saeed Rashid Al-Yateem indicated that the VAT revenues were distributed at a rate of 30% to the federal government and 70% to local governments, indicating that the federal government's share of the excise tax revenue on tobacco and its products represents 45% and 55% for governments. While the federal government’s share represents 30% of the excise tax revenues on other excise goods such as energy drinks, soft drinks and sweetened with added sugar.

He said: "The tax revenues will contribute to the continuation of the implementation of development projects in accordance with the plans targeted by the UAE government, and in mitigating the repercussions of the pandemic of the Coronavirus (Covid-19). The Ministry of Finance continues to follow up tax policies in coordination with the Federal Tax Authority to ensure its alignment with developments in the regional and international arena. And updating legislations continuously in line with the goals of financial policies and sustainable economic growth.

He stressed that there are no plans or decisions at the present time to increase the value-added tax rate to 5% in the country.

For the year 2019, the resulting tax revenue amounted to about 31 billion dirhams, compared to about 29 billion dirhams in 2018, where the growth rate of total tax revenues for 2019 was about 7% over 2018.

It should be noted that the UAE had started applying value-added tax (VAT) on January 1, 2018, at a basic rate of 5% on most goods and services that are supplied at every stage of the supply chain.

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