The UAE’s telecom service providers, etisalat and du, will charge five per cent value added tax on the services and products they offer to the consumers in the country.
“Starting from the 1st of January 2018, most of etisalat’s products and services shall be subject to a five per cent value added tax in compliance with federal laws and regulations levying and regulating the tax in the UAE,” it said in a statement.
Du also said on its website that it would apply the standard VAT rate of five per cent from January 2018 to its products and services.
His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai, on Monday approved the executive regulations for VAT.
The UAE will impose five per cent VAT from 7am on January 1, 2018, on a host of goods and services.
VAT is a consumption tax that the end-user is obligated to pay and etisalat will be only acting as a collection agent on behalf of the taxation authority, the company added. Citing an example, it said a bundle of Dh100 would cost Dh105 from January 2018.
Etisalat urged all its business customers who are entitled to recover their input VAT must officially submit their VAT registration details including tax registration number with supporting evidence to etisalat by December 21, 2017.
Moreover, the company will also start charging Dh25 as late payment fee from subscribers from next month. The late payment charges will be applicable to landline and mobile.