All fizzy drinks and tobacco are expected to be taxed this year, the Minister of State for Financial Affairs announced. Obaid Al Tayer was speaking on Wednesday as the Federal National Council approved a draft law that paves the way for value-added tax (VAT) and excise duties on selected items, by setting up a legal framework for taxation.
Mr Al Tayer said VAT was expected to bring investments down by only 0.06% and the real gross domestic product by 0.04%. The law passed by the FNC stipulates that the fine for tax evasion should not exceed five times the value of the tax. Mr Al Tayer said his ministry is still studying the economic implications of introducing other taxes, such as corporate taxes.
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