The Vice President, Prime Minister and Ruler of Dubai made the announcement while presiding over a UAE Cabinet meeting in Abu Dhabi
Sheikh Mohammed: 70% of VAT revenue to be used in local projects
Seventy per cent of all revenue collected from VAT will be pumped back into local services, Sheikh Mohammed bin Rashid said on Sunday, as officials announced measures to monitor prices and ensure consumer rights are protected.
The Vice President, Prime Minister and Ruler of Dubai chaired a UAE Cabinet meeting in Abu Dhabi where he said the majority of VAT revenue will be funnelled into local emirate government projects to fund "better local services, greater community development and wider support for our citizens".
He said the Government will be transparent about the nature of these projects and firm in controlling the markets to prevent price hikes.
Sheikh Mohammed said the Government will also continue to consult with Emiratis "in all that serves their interests to achieve a decent living for them and their families".
On Sunday, the Ministry of Economy and Federal Tax Authority launched a programme with the aim of protecting consumers’ rights and preventing profiteering.
The programme — that was adopted during a meeting at the ministry headquarters — allows the FTA and the ministry to work with other authorities to detect tax offences and take appropriate measures against them.
Joint awareness campaigns will be held to educate consumers about taxable and exempt products as well as requirements for receipts issued by shops.
Markets will be monitored by inspectors who will verify the authenticity of the Tax Registration Numbers printed on receipts.
“The efforts made by the Ministry of Economy towards protecting consumers are a crucial step in establishing systematic and accurate supervision of the market,” said Khalid Al Bustani, director general of the FTA.
The Minister of Economy, previously estimated that the new levy could generate up to Dh12 billion in revenue in its first year of implementation and Dh20bn in its second year.
According to the FTA, revenue from VAT will contribute towards public services ordinarily paid for from government budgets. "VAT will provide our country with a new source of income which will contribute to the continued provision of high quality public services into the future," the authority said.
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During the Cabinet meeting, Sheikh Mohammed spoke of further developments expected in 2018.
He said the UAE is preparing to be the first Arab country to achieve the "old Arab dream" of producing nuclear energy with the Barakah Nuclear Energy Plant in Abu Dhabi which is expected to begin operation this year.
The Cabinet also adopted the UAE Water Security Strategy 2036 that aims to ensure water availability in sufficient quantities and safe quality in accordance with international standards during normal and emergencies situations, reported state news agency Wam.
The strategy also includes a list of measures for enhancing the water supply, including alternative water sources, emergency water production and distribution, storage mechanisms and water networking across the country.
The Cabinet also adopted the Manual on Measuring Productivity in the Federal Government, which measures performance and productivity in the federal government.
"We also adopted today, a manual to measure the productivity and efficiency of various government agencies," Sheikh Mohammed said.
The aim of the manual is to provide a "clear picture of the performance of officials in the government, be it positive or negative, to take immediate corrective action."
In organisational affairs, the Cabinet approved the appointment of the Board of Directors of the Federal Authority for Nuclear Regulation. It also restructured the Judicial Co-ordination Council to achieve co-ordination among all judicial entities in the UAE.
The Cabinet also approved the estimated budget of the General Authority for Pensions and Social Insurance for the fiscal year 2018.
In the matter of international relations, the Cabinet approved a short-stay visa exemption in Switzerland for Emirati citizens.
The Cabinet also agreed to upgrade the UAE’s diplomatic representation office in Bonn, Germany, to a General Consulate.