Younis Haji Al Khoori, Undersecretary at the Ministry of Finance (MoF) in the UAE says that the GCC countries have formed committees and task forces that will study all the anticipated socio-economic impacts that will come with the issuing of VAT and what the percentage VAT should be set at ( 3 and 5 per cent for various sectors). VAT will not be imposed on certain sectors such as healthcare, education, and staple food items. The Undersecretary also mentioned that any rumors pertaining to disagreements on the tax policies amongst the GCC countries on other sectors are not true. There are been complete agreement from every party in terms of who should be subject to VAT. However, before VAT is implemented across the GCC, each country will have to have its own domestic tax laws structure in place. So far the tax law is still in its early stages as at this point only the draft law has been approved by local authorities.
In terms of the issue regarding taxing workers’ remittances, the UAE MoF Undersecretary said that this issue is not a GCC-wide issue and that each Arab country will have its own right to define what tax policy they deem fit in regards to taxing on remittances. UAE is considering on still implementing corporate tax but has not yet confirmed whether or not it will be introduced.
He included that the UAE government takes after an arrangement of economic broadening and does not depend on only one form of income, including that the commitment of oil revenues has as of now contracted from around 90 per cent of GDP to much low rates, precluding any worries of the real estate sector being influenced by a decrease in oil costs. He also said that last year without any difficulties, UAE prospered in the value of fuel liberalization and was able to reduce subsidies for power and water. Fluctuations in fuel prices allows the country to seek out for new innovative ways for developing clean energy projects and guarantee a superior life for future generations.