By Staff writer
Saudi Arabia on Monday announced the kingdom is to raise VAT from 5% to 15%
The UAE has no plans to follow Saudi Arabia by increasing VAT, according to the country’s Ministry of Finance.
On Monday the kingdom announced a range of austerity measures as the country battles against record low oil prices and an economic slump caused by the current coronavirus pandemic.
That included raising VAT from five percent to 15 percent.
However, in statement, Younis Haji Al Khoori, undersecretary of the UAE's Ministry of Finance said there were no plans for an increase.
He said: "We at the Ministry of Finance are studying our financial systems to ensure their readiness to manage the next stage and support all vital sectors.
"We are devising several programs and projects to enhance our ability to continue the development process and to put people as our top priority. This is essential to build a secure future and achieve the well-being and stability of our society.
"The UAE has always been keen to take precautionary measures and launch financial initiatives, which protect the national economy and support various business sectors in the country."
The UAE’s VAT rate, which was introduced at the beginning of 2018, currently stands at five percent.
In April it was announced that it would delay the due date for payment of VAT from March 31 until May 28, as part of support measures to aid the country’s economy during the current economic crisis.
Measures introduced by Saudi Arabia also include ending monthly cost-of-living allowances paid to government workers as well as a reduction in spending on some programmes under Crown Prince Mohammed bin Salman’s ‘Vision 2030’ economic transformation plan.