Saudi Arabia have announced that VAT will rise from 5% to 15% from 1st July 2020.
Reacting to the Saudi announcement, H.E. Younis Haji Al Khouri, under-secretary in the Finance Ministry, is quoted as saying that the UAE has no plans to raise the rate of VAT.
A reading of the GCC VAT Law does not appear to compel the UAE to follow suit.
The Saudi economy is tied more to the Petroleum industry than the UAE and recent downward prices will likely have contributed to this decision.
We will continue to watch and advise our Clients on the implications to their businesses regarding decisions in these dynamic times.
If you need support with VAT or Finance more generally, then call Gulf Tax Accounting Group (GTAG), your trusted advisors in the GCC.
Read GTAG Partner David Daly in The National
This article will be updated as more information is known.