UAE Domestic VAT Law Released

On 27 August 2017, the United Arab Emirates (the "UAE") published the text of its domestic Value Added Tax (the "VAT") Law, shortly after releasing the text of its Excise Tax Law last week, and the Federal Tax Procedures Law earlier this month. It will be followed by implementing regulations, which will provide more detail on application of the VAT Law.

The UAE Government is still planning to introduce VAT on 1 January 2018.

The main features of the new tax may be summarised as follows:

• The standard VAT rate of 5% will be applied to all transactions involving goods and services (e.g. food, consulting services, maintenance works etc.) that are not VAT-exempt or zero-rated (the zero rate means that there no charge of VAT on the supply but allows a full VAT recovery for the supplier, which is not possible for VAT-exempt supplies).