Schools will not be allowed to raise fees over VAT

Schools will not be allowed to raise fees over VAT

The upcoming value-added tax (VAT) will not be applicable to nurseries and schools, a senior official said on Monday according to a report in Gulf News. VAT will be introduced in the UAE from January 1 next year.

“By mid-2018, the VAT law will detail how the tax will impact the universities and educational institutions across the country,” Saeda Al Qaddoumi, an adviser at the Federal Tax Authority, said.

Al Qaddoumi said schools and nurseries can get tax refunds for supplies and services, furniture and computers. But schools will not be allowed to raise fees over VAT.

“UAE firms will be able to begin registering VAT from the middle of next month. Companies will be able to register for VAT through the Federal Tax Authority’s website from mid-September,” said Khalid Ali Al Bustani, the director-general of the Federal Tax Authority, last week.

Al Qaddoumi said VAT will not be applicable to medicines and medical equipment. “A decision will be issued to detail all sort of medicines and equipment’s,” Al Qaddoumi said.

Employees will not be paying VAT because they are not practicing an independent activity.

Although the final list of exempt items is not yet out, Al Qaddoumi said that most food items will fall under the 5 per cent VAT rate, including basic goods. Imported goods and services will also be taxed at 5 per cent. VAT will also be applicable to utility bills (electricity and water) as well as mobile telephone and internet bills.

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