UAE Tourists Can Demand Their VAT Returns from Today
If you are visiting the UAE, you have one thing to rejoice. From 18th November, the UAE government won’t be setting any limit for tourists’ VAT refund. Gary Byrne, director of new markets and group strategic partnership stated that the daily maximum VAT refund for tourists has been limited to Dh10000 in cash. However, if the refund claim surpasses that set amount, funds would be then electronically transferred to the tourists.
During a press conference, Byrne stated that in case of cash refund the lint has been restricted to Dh10,000 and for unlimited the amount would be electronically transferred to the account of the traveler or to the traveler’s debit or credit cards.
The entire process for tourist VAT refunds would be handles by Planet on behalf of the UAEs Federal Tax Authority (FTA). Byrne disclosed that the numbers of companies who have registered for tourist VAT refund scheme are supposed to double from the present 4500 plus to 6000 by the end of this year and reach 10000 by next year. The companies who have registered cover various sectors, such as global traders, souks, general traders, etc. he even added that majority of the VAT refund from tourists would come from purchases of electronics, gold jewelry, and luxury items.
The total value of tax inclusive purchases from the retailer must add up to a minimum of Dh250 to be worthy for a refund. Tourists won’t get the full 5 % VAT because the refund is restricted to 85% of the VAT amount paid to the retailer, which is less a one-off administrative fee of Dh4.80 per tax-free form.
Khalid Ali Al Bustani, Director-General of the FTA, stated that the retailers would need to pass credit check and regularly settle tax payments and submit VAT returns in order to become fit for the refunds. In case they stop paying the dues, the FTA will hold the right to eliminate the companies from the scheme.
Byrne stated that this scheme will definitely play a crucial role in bolstering inbound tourism to Dubai and the UAE.