The UAE is not currently planning to raise its value-added tax (VAT) rate of 5 percent, the finance ministry said on Monday after Saudi Arabia announced it was tripling its rate.
Saudi Arabia earlier on Monday said that from July 1 VAT would triple to 15 percent from 5 percent, with the kingdom seeking to contain the financial hit caused by low oil prices and coronavirus pandemic.
In a statement, the UAE finance ministry denied there were “any plans currently to raise value-added tax.”
In 2017, six Gulf Cooperation Council (GCC) states agreed on a “Unified VAT Agreement”, with the UAE and Saudi Arabia having introduced a 5 percent VAT rate in 2018. Bahrain implemented the tax in 2019.
Meanwhile, other GCC members Qatar, Kuwait, and Oman have not introduced the VAT.
UAE’s tax revenue, including VAT, constitute 5.5 percent of its total public revenue in 2018, the official news agency WAM cited the Ministry of Finance as saying late 2019.