Here’s an overview of VAT (Value Added Tax) rates in Dubai, which follows the VAT system of the United Arab Emirates (UAE):
VAT Rates in Dubai
| Category | VAT Rate | Notes |
|---|---|---|
| Standard Rate | 5% | Applies to most goods and services. |
| Zero-rated Supplies | 0% | Includes exports, international transport, and certain goods and services. |
| Exempt Supplies | Exempt | Includes specific financial services, healthcare, and education. |
Detailed Explanation:
- Standard Rate (5%): This is the general VAT rate applicable to most goods and services in Dubai and across the UAE.
- Zero-rated Supplies (0%): This includes exports of goods and services, international transport, and certain other goods and services like education and healthcare services provided by approved entities.
- Exempt Supplies: Specific sectors are exempt from VAT, including certain financial services, healthcare services, and educational services, reflecting the UAE’s focus on supporting key industries.
Additional Points:
- VAT Registration: Businesses in Dubai must register for VAT if their taxable turnover exceeds AED 375,000. Businesses with turnover between AED 187,500 and AED 375,000 can also register voluntarily.
- UAE VAT System: Dubai follows the VAT framework established by the UAE Federal Tax Authority, which ensures consistency across all emirates.
These VAT rates and regulations are administered by the UAE Federal Tax Authority and are subject to periodic updates.