UAE Press: VAT allocation benefits all

ABU DHABI, 9th January, 2018 (WAM) — The introduction and implementation of value-added tax, VAT, on 1st January had brought the UAE into a more sophisticated regulatory and fiscal framework, one that is expected to add some AED12 billion in new revenues in the current year, and increasing to between AED18 to 20 billion in 2019, said an editorial comment.

“Now there’s new clarity on how those extra revenue streams will be allocated across the seven emirates, following a Cabinet meeting on Sunday in Abu Dhabi and a statement from the Vice President, Prime Minister and Ruler of Dubai, His Highness Sheikh Mohammed bin Rashid Al Maktoum,” said Gulf News in an editorial on Tuesday.

The Dubai-based daily added, “Seventy percent of revenues from VAT will be allocated to the emirates themselves, with the remaining portion going to the federal government’s annual budget. That 70 percent allocation to the emirates represents a huge boost in their revenues, allowing for them to prioritise and allocate funding on projects within their areas.”


The paper quoted Sheikh Mohammed as saying, “Distribution of the VAT revenues aims to achieve better local services, greater community development and broader support for our citizens.”

It went on to say, “This is an important step in making sure every level of government has the funds and ability to prioritise projects and development works within their geographical jurisdictions, and allowing those projects to be prioritised. The allocation of 70 percent of VAT revenues to each emirate will also increase the process of transparency at every level, while making sure too that those who receive and spend those monies are fully accountable.

“The introduction of VAT is part of the UAE government’s ongoing and effective efforts to implement best international practices and policies that serve the national economy, and also ensure that the revenues, financial resources and regulatory frameworks are in place to best serve all and without impacting the welfare and happiness of all Emiratis.”

“By allocating the lion’s share to emirates, the government is also ensuring that all areas of the nation are fine tuned to ensure infrastructure across the board is aligned, cohesive and comprehensive, best-serving the UAE as it embraces the future,” concluded the paper.

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