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Abu Dhabi, UAEMonday 10 December 2018

VAT in UAE: Etisalat and du announce charges

UAE telecoms companies tell customers that products and services would be subject to the 5 per cent levy

A prison worker is accused of providing extra meals for inmates in exchange for mobile phone recharge cards. EPA
A prison worker is accused of providing extra meals for inmates in exchange for mobile phone recharge cards. EPA

The two telecommunications companies in the UAE, Etisalat and du, sent customers messages announcing that products and services would be applicable to the 5 per cent value-added tax (VAT) that is coming into effect in a month.

Etisalat said that “most” of its products and services would be subject to the rate hike in compliance with federal laws and regulations “levying and regulating the tax in the UAE”.

“VAT is a consumption tax that the end user is obligated to pay and Etisalat will be only acting as a collection agent on behalf of the taxation authority,” the company said.

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Read more:

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Du sent a different message without specifying if some or all of its services and products would be taxed.

It said that the 5 per cent fee would be “applicable to our products and services. The company’s website said instead that “further details will be made available in the coming weeks”.

It is important that consumers know that businesses must be registered, providing a tax registration number to the public if requested, to collect VAT.