UAE is set to enforce a 5% VAT (Value Added Tax) on gold which is expected to cause a dramatic drop in gold jewelry sale this year. The jewellery showrooms reported a hike in consumers in the last few days as the VAT is taking effect from today onwards.
Under the new system, residents and tourists buying gold jewelry will have to pay 5 percent tax but the good news is that a VAT rate of 5% is still low compared to other countries.
Value Added Tax (VAT) on things like water, electricity, gas and telephone services is expected to increase the daily living expenses from 5 to 15%. However, experts believe that it won’t break the bank for most people.
Parents will need to shell out more for school uniforms, laptops, and other electronic products for their kids but school fees will be exempt from the tax.