Water and electricity bills in the UAE will be subject to the 5 per cent value added tax from January 1.
With 35 business days left until the implementation of valued added tax in the UAE, final details have emerged about which goods and services will be subject to the levy and which will be zero-rated and exempt.
Value-added tax, known in some countries as goods and services tax, or GST, is a consumption levy imposed on a product at each stage of production, before the final sale.
A 5 per cent VAT is set to come into force in the UAE and Saudi Arabia on January 1 with the rest of the GCC following by the beginning of the following year. In the UAE, VAT could generate Dh12 billion in its first year and Dh20bn in its second year, according to Sultan Al Mansouri, the Minister of Economy.
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Tax in the UAE: Everything you need to know about VAT and a little bit more
UAE's tax authority urges businesses to register for VAT before Dec 4
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According to the executive regulation which has been approved by the UAE Cabinet and will be issued soon, a copy of which has been seen by The National, water and electricity are considered supplied goods.
In article 2, headed “Supplies of goods”, it says: “A supply of water and all forms of energy including electricity and gas… whether used for lighting, or heating, or cooling, or air conditioning or any other purposes.”
In Abu Dhabi, water and electricity prices have been rising as the Government reduces subsidies to encourage more efficient use of resources.
The introduction of VAT is set to increase the cost of living by about 2.5 per cent, according to several forecasts.
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VAT in the UAE
[ New Year's Day VAT dilemma for UAE consumers and businesses ]
[ Who will bear the burden of VAT in the UAE? ]
[ 'Don’t stress about VAT in the UAE - it’s not complicated at all' ]
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At a presentation given yesterday in Dubai by the Federal Tax Authority, it was underlined that anything which is not included in the executive regulation as exempt or zero rated is subject to VAT at the standard rate.
This includes petrol, diesel, cars, clothes and electronics. Online retailers will also have to ensure that VAT is applied to goods sold on their platforms, even by third parties. Other digital businesses such as “social influencers” are also subject to VAT, the authority said.
David Daly, a chartered accountant in the UAE and the UK and partner at Argent Gulf Consulting, said that while the details are now being confirmed, the big picture has been long trailed.
“For example the big picture includes tuition fees, where the curriculum is Government approved, being zero rated while the details include school uniforms as standard rated,” he said.
The UAE also introduced in October excise tax on energy drinks, tobacco and sugary drinks.
The implementation of VAT across the GCC could be delayed due to coordination and preparatory work requirements needed to introduce the tariff at the beginning 2018, the IMF said last month.
Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
DEADPOOL & WOLVERINE
Starring: Ryan Reynolds, Hugh Jackman, Emma Corrin
Director: Shawn Levy
Rating: 3/5
COMPANY PROFILE
Company name: Almouneer
Started: 2017
Founders: Dr Noha Khater and Rania Kadry
Based: Egypt
Number of staff: 120
Investment: Bootstrapped, with support from Insead and Egyptian government, seed round of
$3.6 million led by Global Ventures
COMPANY PROFILE
Company name: Klipit
Started: 2022
Founders: Venkat Reddy, Mohammed Al Bulooki, Bilal Merchant, Asif Ahmed, Ovais Merchant
Based: Dubai, UAE
Industry: Digital receipts, finance, blockchain
Funding: $4 million
Investors: Privately/self-funded
Company Profile
Name: HyveGeo
Started: 2023
Founders: Abdulaziz bin Redha, Dr Samsurin Welch, Eva Morales and Dr Harjit Singh
Based: Cambridge and Dubai
Number of employees: 8
Industry: Sustainability & Environment
Funding: $200,000 plus undisclosed grant
Investors: Venture capital and government
Herc's Adventures
Developer: Big Ape Productions
Publisher: LucasArts
Console: PlayStation 1 & 5, Sega Saturn
Rating: 4/5
No more lice
Defining head lice
Pediculus humanus capitis are tiny wingless insects that feed on blood from the human scalp. The adult head louse is up to 3mm long, has six legs, and is tan to greyish-white in colour. The female lives up to four weeks and, once mature, can lay up to 10 eggs per day. These tiny nits firmly attach to the base of the hair shaft, get incubated by body heat and hatch in eight days or so.
Identifying lice
Lice can be identified by itching or a tickling sensation of something moving within the hair. One can confirm that a person has lice by looking closely through the hair and scalp for nits, nymphs or lice. Head lice are most frequently located behind the ears and near the neckline.
Treating lice at home
Head lice must be treated as soon as they are spotted. Start by checking everyone in the family for them, then follow these steps. Remove and wash all clothing and bedding with hot water. Apply medicine according to the label instructions. If some live lice are still found eight to 12 hours after treatment, but are moving more slowly than before, do not re-treat. Comb dead and remaining live lice out of the hair using a fine-toothed comb.
After the initial treatment, check for, comb and remove nits and lice from hair every two to three days. Soak combs and brushes in hot water for 10 minutes.Vacuum the floor and furniture, particularly where the infested person sat or lay.
Courtesy Dr Vishal Rajmal Mehta, specialist paediatrics, RAK Hospital
WHAT IS A BLACK HOLE?
1. Black holes are objects whose gravity is so strong not even light can escape their pull
2. They can be created when massive stars collapse under their own weight
3. Large black holes can also be formed when smaller ones collide and merge
4. The biggest black holes lurk at the centre of many galaxies, including our own
5. Astronomers believe that when the universe was very young, black holes affected how galaxies formed
Other key dates
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Finals draw: December 2
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Finals (including semi-finals and third-placed game): June 5–9, 2019
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Euro 2020 play-off draw: November 22, 2019
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Euro 2020 play-offs: March 26–31, 2020
LA LIGA FIXTURES
Friday Valladolid v Osasuna (Kick-off midnight UAE)
Saturday Valencia v Athletic Bilbao (5pm), Getafe v Sevilla (7.15pm), Huesca v Alaves (9.30pm), Real Madrid v Atletico Madrid (midnight)
Sunday Real Sociedad v Eibar (5pm), Real Betis v Villarreal (7.15pm), Elche v Granada (9.30pm), Barcelona v Levante (midnight)
Monday Celta Vigo v Cadiz (midnight)
How to increase your savings
- Have a plan for your savings.
- Decide on your emergency fund target and once that's achieved, assign your savings to another financial goal such as saving for a house or investing for retirement.
- Decide on a financial goal that is important to you and put your savings to work for you.
- It's important to have a purpose for your savings as it helps to keep you motivated to continue while also reducing the temptation to spend your savings.
- Carol Glynn, founder of Conscious Finance Coaching