The ministry of finance will start registering companies that are above the yearly threshold for value-added tax in the second half of this year as the country gears up for implementing the 5 per cent levy from January 1, 2018.
The ministry announced on twitter that businesses that provide taxable goods or services worth more than Dh375,000 annually will be required to register. Businesses with taxable supplies below Dh375,000 but over Dh187,500 will have the option to register, it added.
The UAE has yet to publish its VAT law but has established a federal tax authority to deal with the levy.
Last week, the Federal National Council approved a draft law that paves the way for VAT and excise duties on selected items, by setting up a legal framework for taxation.
The ministry has started awareness sessions with regards to VAT and ­excise tax implementation for ­businesses, including small and medium-sized ­enterprises in a bid to prepare them for the implementation.
"These workshops also serve to underline the importance of the new tax system as a necessary step towards securing a sustainable future for the UAE, while making sure businesses are fully prepared to file their tax returns and adapt to the new tax law," said Younis Haji Al Khoori, Under-Secretary of the Ministry of Finance, according to Wam.
The introduction of value-added tax in the UAE next year, in tandem with the other five GCC countries, will boost government revenues that took a hit with falling oil prices.
VAT could generate Dh12 billion in its first year and Dh20bn in its second year, according to Sultan Al Mansouri, the Minister of Economy.
The Ministry of Finance plans to give businesses a grace period – yet to be decided – to deal with implementation of the law, according to Saeed Al Yateem, assistant undersecretary of resources and budget sector at the ministry.
None of the six GCC ­countries have published VAT laws and there is no clear ­picture of the type of products and services that will be ­taxable.

Source: The National