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Tourists to get refunds on VAT paid

Tourists to the UAE will be able to claim back the value added tax (VAT) on purchases they make whilst visiting the country, according to the recently released executive regulations by the Federal Tax Authority (FTA).

The regulations do not, however, go into details on how this process would work.

It does state that the refund system would only be eligible to those travelling to the UAE from outside the Gulf Co-operation Council (GCC).

The FTA has suggested that the exact mechanism for claiming back VAT will be agreed upon, and announced, by the UAE’s Cabinet, in the coming months.

According to the document, posted to the FTA’s website, the Cabinet “may issue a decision introducing the Tax Refunds for Tourists Scheme,” which will specify the following: the date on which the scheme comes into effect, the mechanism for tax refunds and the limitations on claiming tax refunds, among other details.

According to the executive regulations, the following conditions shall apply to the Tax Refunds for Tourists Scheme: the goods must be supplied to the visitor whilst he or she is in the country, at the time of purchase; the visitor must be intending to leave within 90 days of purchase; and the visitor must be from outside the GCC.

It also went on to add that the Cabinet may publish a list of goods that will not be eligible for refunds.

Source: Gulf News

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