The UAE's Ministry of Finance (MoF) on Tuesday issued the first VAT inclusive purchase order, and approved the first VAT invoice on its federal financial system.
The milestone for the UAE's tax system follows the launch of value added tax on January 1.
The Ministry recently announced that the federal financial system has been updated and is ready to manage all VAT related financial transactions.
MoF said it provides a technical support team, as well as a telephone number (600 533 336) dedicated to respond to any inquiries related to VAT from any federal entities linked to the system.
Mariam Al Amiri, Assistant Undersecretary for the Management of Financial Resources, said: “The Ministry of Finance continues its efforts to facilitate all government finance procedures, specifically VAT transactions. Issuing the first purchase invoice reflects the efficiency and ease of use of the system, and highlights the Ministry’s efforts to facilitate procurement processes for all federal entities linked to the federal financial system."
VAT was introduced in the UAE and Saudi Arabia on Monday in accordance with the unified VAT Agreement for the Cooperation Council of the Arab States of the Gulf.
Over the past months, the Ministry of Finance and the Federal Tax Authority have held a series of workshops, and practical training sessions for users of the federal financial system.
VAT is the latest in a series of measures introduced by Gulf oil producers over the past two years to boost revenues and cut spending as a persistent slump in world prices has led to ballooning budget deficits.
The five percent sales tax applies to most goods and services and analysts project that the two governments could raise as much as $21 billion in 2018, equivalent to 2 percent of GDP.
The other four Gulf states - Bahrain, Kuwait, Oman and Qatar - are also committed to introducing VAT but have delayed the move until early 2019.For all the latest business 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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