Daily cash limit for VAT refunds for tourists set at Dh7,000

The decision aims to encourage digital or smart transactions instead with no limit placed on credit card refunds

A limit for VAT cash refunds for tourists has been set at a maximum of Dh7,000 per day.

The decision was issued by Sheikh Hamdan bin Rashid, Deputy Ruler of Dubai, Minister of Finance and chairman of the Federal Tax Authority, on Sunday in an effort to reduce the amount of cash transactions carried out in the UAE.

Tourists applying through the Tax Refunds for Tourists Scheme will now have their refunds capped at Dh7,000.

"The new decision […] is in line with the UAE’s overall strategy to reduce reliance on cash in financial transactions, and benefit from the country’s advanced digital and technological infrastructure,” said Khalid Al Bustani, director-general of the FTA.

“These systems […] facilitate the flow of money and financial assets securely, increasing trust in financial transactions — both local and international."

Last month, self-service kiosks were installed at exit points across the country to help tourists reclaim their VAT refunds more efficiently.

Tourists who apply for their refunds on those kiosks will have their money refunded on their credit cards.

“No limit is placed on the maximum amount that can be recovered if said amount is transferred to the tourist’s credit card,” Mr Al Bustani said at the time.

The procedure involve a few online steps that help users determine the taxes eligible for a refund; verify that the purchased items are with them when applying for the refund; and then recover the taxes through an automated process without interacting with employees.

Tourists can submit their tax invoices on purchases they made at retail outlets registered within the scheme, along with their passport and credit card.