DUBAI // The price of items such as cars, televisions and restaurant bills will rise once value-added tax is introduced in the region early next year.
But as the tax will be at a modest 5 per cent, experts say it is unlikely to affect overall spending.
Details about goods and services to be subject to VAT will probably be released over the next few months, and awareness sessions have begun to help understand its implications.
Because VAT is added to the cost of products, shoppers might not immediately notice a rise in prices but many are concerned about how it will affect their families.
“My worry is that my monthly grocery bill should not go up,” said Carla Stephenson, a housewife. “School fees are already expensive and rents have not come down by much so if other prices move up, of course it will affect people.
“I understood that basic food will not be taxed but will cheese, cake, ice creams, juice cost more? That will affect families.”
None of the six GCC nations has published VAT laws. Government announcements clarified that the tax would not affect people with low or middle incomes.
Exceptions would be made for basic food items, health care, essential medicine, education, and the sale or lease of residential property, with about 100 items not subjected to tax.
“It is inevitable prices will increase,” said Justin Whitehouse of consultancy Deloitte Middle East.
“In practice, it is not always the case that prices simply jump by the VAT rate of 5 per cent because retailers may absorb some of the cost and also because not everything is subject to VAT. I expect vehicles, clothing, electronics and hotels to all be subject to VAT at the standard rate.”
David Stevens, of the E Y accountancy company, said: “We would expect overall consumer prices to rise by a modest 2 per cent. This may be split 1 per cent at the commencement and another 1 per cent spread over the first half of 2018.
“For those goods and services subject to the VAT, prices will rise either initially by the full 5 per cent or, in many cases, by 5 per cent but over a period of time as retailers seek to lessen the immediate rise.”
GCC countries are introducing VAT to boost government revenues, which have taken a beating from falling oil prices.
Businesses and retailers have largely been supportive, particularly after the Government said that VAT could generate Dh12 billion in its first year and Dh20bn the year after.
“We don’t see any negative impact on the buying sentiment and on the consumer’s mind because this will not affect essential commodities, where people would get hurt fast,” said V Nandakumar, head of corporate communication at LuLu, which operates 133 hypermarkets and shopping centres in nine countries.
“The VAT proposed is a small amount compared to other countries, so the negative impact will be very minimal.
“Also, with so many nationalities staying here, people are aware of taxation and VAT in some form or the other in their home countries, so people will not be taken aback.
“And long term it will benefit the economy as a whole, which is a good thing for business.”
rtalwar@thenational.ae
THE SPECS
Touareg Highline
Engine: 3.0-litre, V6
Transmission: 8-speed automatic
Power: 340hp
Torque: 450Nm
Price: Dh239,312
How to wear a kandura
Dos
- Wear the right fabric for the right season and occasion
- Always ask for the dress code if you don’t know
- Wear a white kandura, white ghutra / shemagh (headwear) and black shoes for work
- Wear 100 per cent cotton under the kandura as most fabrics are polyester
Don’ts
- Wear hamdania for work, always wear a ghutra and agal
- Buy a kandura only based on how it feels; ask questions about the fabric and understand what you are buying
The specs
Engine: 2.0-litre 4-cyl turbo
Power: 247hp at 6,500rpm
Torque: 370Nm from 1,500-3,500rpm
Transmission: 10-speed auto
Fuel consumption: 7.8L/100km
Price: from Dh94,900
On sale: now
How to get there
Emirates (www.emirates.com) flies directly to Hanoi, Vietnam, with fares starting from around Dh2,725 return, while Etihad (www.etihad.com) fares cost about Dh2,213 return with a stop. Chuong is 25 kilometres south of Hanoi.
Tori Amos
Native Invader
Decca
SPECS
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Film: Raid
Dir: Rajkumar Gupta
Starring: Ajay Devgn, Ileana D'cruz and Saurabh Shukla
Verdict: Three stars
Libya's Gold
UN Panel of Experts found regime secretly sold a fifth of the country's gold reserves.
The panel’s 2017 report followed a trail to West Africa where large sums of cash and gold were hidden by Abdullah Al Senussi, Qaddafi’s former intelligence chief, in 2011.
Cases filled with cash that was said to amount to $560m in 100 dollar notes, that was kept by a group of Libyans in Ouagadougou, Burkina Faso.
A second stash was said to have been held in Accra, Ghana, inside boxes at the local offices of an international human rights organisation based in France.
CHELSEA'S NEXT FIVE GAMES
Mar 10: Norwich(A)
Mar 13: Newcastle(H)
Mar 16: Lille(A)
Mar 19: Middlesbrough(A)
Apr 2: Brentford(H)
The specs
Engine: Long-range single or dual motor with 200kW or 400kW battery
Transmission: Single-speed automatic
Max touring range: 620km / 590km
Price: From Dh250,000 (estimated)
More from Neighbourhood Watch:
Jigra
Starring: Alia Bhatt, Vedang Raina, Manoj Pahwa, Harsh Singh
SPECS
Engine: 4-litre V8 twin-turbo
Power: 630hp
Torque: 850Nm
Transmission: 8-speed Tiptronic automatic
Price: From Dh599,000
On sale: Now
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Company%20Profile
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Traits of Chinese zodiac animals
Tiger:independent, successful, volatile
Rat:witty, creative, charming
Ox:diligent, perseverent, conservative
Rabbit:gracious, considerate, sensitive
Dragon:prosperous, brave, rash
Snake:calm, thoughtful, stubborn
Horse:faithful, energetic, carefree
Sheep:easy-going, peacemaker, curious
Monkey:family-orientated, clever, playful
Rooster:honest, confident, pompous
Dog:loyal, kind, perfectionist
Boar:loving, tolerant, indulgent
How to help or find other cats to adopt
COMPANY%20PROFILE
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Living in...
This article is part of a guide on where to live in the UAE. Our reporters will profile some of the country’s most desirable districts, provide an estimate of rental prices and introduce you to some of the residents who call each area home.
'Fantastic Beasts: The Secrets of Dumbledore'
Rating: 3/5
Directed by: David Yates
Starring: Mads Mikkelson, Eddie Redmayne, Ezra Miller, Jude Law
Du Football Champions
The fourth season of du Football Champions was launched at Gitex on Wednesday alongside the Middle East’s first sports-tech scouting platform.“du Talents”, which enables aspiring footballers to upload their profiles and highlights reels and communicate directly with coaches, is designed to extend the reach of the programme, which has already attracted more than 21,500 players in its first three years.
COMPANY PROFILE
Name: Almnssa
Started: August 2020
Founder: Areej Selmi
Based: Gaza
Sectors: Internet, e-commerce
Investments: Grants/private funding
World Series
Game 1: Red Sox 8, Dodgers 4
Game 2: Red Sox 4, Dodgers 2
Game 3: Saturday (UAE)
* if needed
Game 4: Sunday
Game 5: Monday
Game 6: Wednesday
Game 7: Thursday
The%20specs
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The specs
Engine: 3.0-litre six-cylinder turbo
Power: 398hp from 5,250rpm
Torque: 580Nm at 1,900-4,800rpm
Transmission: Eight-speed auto
Fuel economy, combined: 6.5L/100km
On sale: December
Price: From Dh330,000 (estimate)
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'Falling%20for%20Christmas'
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COMPANY%20PROFILE
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Company%20Profile
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The biog
Favourite books: 'Ruth Bader Ginsburg: A Life' by Jane D. Mathews and ‘The Moment of Lift’ by Melinda Gates
Favourite travel destination: Greece, a blend of ancient history and captivating nature. It always has given me a sense of joy, endless possibilities, positive energy and wonderful people that make you feel at home.
Favourite pastime: travelling and experiencing different cultures across the globe.
Favourite quote: “In the future, there will be no female leaders. There will just be leaders” - Sheryl Sandberg, COO of Facebook.
Favourite Movie: Mona Lisa Smile
Favourite Author: Kahlil Gibran
Favourite Artist: Meryl Streep
Final scores
18 under: Tyrrell Hatton (ENG)
- 14: Jason Scrivener (AUS)
-13: Rory McIlroy (NIR)
-12: Rafa Cabrera Bello (ESP)
-11: David Lipsky (USA), Marc Warren (SCO)
-10: Tommy Fleetwood (ENG), Chris Paisley (ENG), Matt Wallace (ENG), Fabrizio Zanotti (PAR)
BACK%20TO%20ALEXANDRIA
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COMPANY PROFILE
Name: HyperSpace
Started: 2020
Founders: Alexander Heller, Rama Allen and Desi Gonzalez
Based: Dubai, UAE
Sector: Entertainment
Number of staff: 210
Investment raised: $75 million from investors including Galaxy Interactive, Riyadh Season, Sega Ventures and Apis Venture Partners
COMPANY%20PROFILE
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