This week the spotlight is on enhancements to our UAE Federal Laws coverage where with the permission of ProConsult Advocates & Legal Consultants we have published an unofficial translation of the UAE’s new VAT Federal Decree-Law (Federal Decree-Law No. 8/2017). It can be found here: http://www.lexismiddleeast.com/doc/3938304C495F4C4E5F323031372D30382D32335F30303030385F4D61724B616E5F456E.

We are still awaiting the official publication of the Decree-Law and are still monitoring this legislative development with our Publishing Partners, SADER Legal Publishing.

In other developments in this area, the UAE’s Federal Tax Authority board have approved changes to the UAE tax system, including new procedures to adopt a selective tax system in October and VAT in January 2018. The board went on to approve the proposed fees and fines in line with the Authority's remit as laid out in Federal Decree-Law No. 13/2016. Finally they approved the penalties to be applied for breaches of Federal Law No. 7/2017 and Federal Decree-Law No. 8/2017. The Minister of State for Financial Affairs said work on issuing executive regulations to these laws to provide specific details about their implementation is underway.

This week the UAE’s President has issued the Federal VAT Decree-Law (Federal Decree-Law No. 8/2017) so we focus on this tax development in this issue. We have requested this Law as a priority from our Publishing Partners, SADER Legal Publishing. We will keep you updated as and when this Law is Gazetted and when it is available on our service.

We have been pleased to add commentary from Clyde & Co and Arendt & Medernach on this latest development. Clyde & Co’s analysis can be found here: http://www.lexismiddleeast.com/doc/2506361_2506370 while Arendt & Medernach’s analysis can be found here: http://www.lexismiddleeast.com/doc/2506689_2506691?highlight=Arendt+%26+Medernach These articles join over fifty articles we have published this year on this prospective development which is now becoming a reality.

From 1 January 2018, the 5% tax will be imposed on the import and supply of goods and services at each stage of production and distribution. It includes what is considered a supply and specifies the goods and services which will be zero-rated as well as the exceptions. The tax imposed will be the responsibility of a Taxable Person who makes taxable supplies or what is considered to be a supply or on import.

This week the spotlight is on tax developments in the UAE, where the country’s President has issued the excise tax law covering the taxation of tobacco, fizzy and energy drinks. It will be published in the Official Gazette and come into force on 1 October 2017. Excise tax at 100% will be levied on tobacco and energy drinks and 50% on fizzy drinks (excluding carbonated water) under Federal Decree-Law No. 7/2017. The regulations to the Law will come into force by December 2017. The law details the tax’s general rules and procedures. Article 16 of the law says some products liable for excise which are used in the manufacturing process for other goods also subject to excise taxes could get special discounts. More details will be given in the regulations to the law. Under the law products liable for duty which are exported could be exempted from duty, or be liable for a discounted rate.

Elsewhere, according to local newspaper reports, the UAE’s Federal Tax Authority has announced schools and nurseries will be zero-rated for VAT purposes. The Authority added schools and nurseries should therefore not increase their fees next year. Being zero-rated allows companies and institutions to reclaim VAT paid on business costs and services.