State-owned Dubai Water and Electricity Authority (DEWA) is preparing for implementation of five percent value-added tax, which will be rolled out across the GCC from January 2018.
The utility company is the first government entity in the emirate to have issued a public tender this week, seeking consultant for VAT preparedness and implementation. No other details are mentioned in the tender.
Arabian Business has approached DEWA for a comment.
The UAE Ministry of Finance defines VAT, as a general consumption tax, which it says will apply to the majority of transactions in goods and services with a limited number of reliefs likely to be granted.
Arabian Business reported earlier that companies will be able to register online for VAT from October.
The Finance Ministry has, however, said that not all businesses will need to register for VAT with exemption granted to small businesses.
“We have made this decision to safeguard small businesses from the extensive documentation and reporting that a system like VAT requires. Also, businesses may not need to register with the government if they only provide goods and services which are not subject to VAT,” it said.
With just 10 months left until VAT is rolled out in the Gulf region, Clare McColl, KPMG Lower Gulf VAT Partner, UAE, has advised businesses to review their processes to understand the impact of VAT and to determine what needs to be done to be fully VAT compliant.
“VAT will impact all businesses in the GCC, either directly or indirectly and, as a transaction-based tax, will impact all aspects of business.
“Finance, legal, IT, sales, marketing and even human resources teams must understand the impact of VAT on their functioning and determine whether the introduction of VAT will result in additional costs, which could be actual or cash flow or compliance-related,” she said.For all the latest banking and finance news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.
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