A tax is a mandatory financial charge or some other type of levy imposed upon a taxpayer (an individual or other legal entity) by a governmental organization in order to fund various public expenditures. A failure to pay, or evasion of or resistance to taxation, is punishable by law.
WHAT IS VAT?
A value-added tax (VAT) is a type of consumption tax that is placed on a product whenever value is added at a stage of production and at the point of retail sale.The amount of VAT that the user pays is on the cost of the product, less any of the costs of materials used in the product that have already been taxed.
VAT is expected to be introduced with effect from 1st January 2018 at a standard rate of 5% in the UAE. Taxable persons with a minimum turn over of AED 375,000 and above should get registered with the Federal Tax Authority on the website. The website enables you to know all about VAT in the Dubai and through this portal, eligible businesses can register for VAT in the UAE. The same website provides an option to register for Excise Tax as well. The Tax registration number will be issued by the Federal Tax Authority. The procedure to register for VAT in Dubai and other provinces of UAE will have to be carried out on the Federal Tax Authority website.