The United Arab Emirates looks set to be the first Gulf state to introduce VAT, as it looks to make up for falling oil revenues.
From January 2018, tourists and other shoppers visiting Dubai and other cities in the UEA will have to pay a 5% tax on goods and services. The UAE government said the new tax will raise £2.5bn in its first year, amounting to 0.9% of GDP. UAE’s economy grew by 3% last year, down from the 3.8% rise in 2015.
Commentators believe other Gulf States such as Saudi Arabia, Oman and Bahrain will follow suit.
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