Amid the recent implementation of the 5% value-added tax (VAT) in the United Arab Emirates, authorities have declared 20 areas which are VAT-free.
The designated zones are still part of the country, according to Khaleej Times report, but are considered outside UAE in terms of value-added taxation.
Importers, exporters, and clearing agents were confused in this set up because only fence free areas could benefit from this status, the report said.
According to Thomas Vanhee, founding partner of Aurifer Middle East Tax, even though this is approved by the FTA, there are no legal basis not to apply VAT on imports into the these zones because there are no published cabinet decision.
Listed below are the 20 areas where VAT is exempted as per the report:
Abu Dhabi: Free Trade Zone of Khalifa Port; Abu Dhabi Airport Free Zone; and Khalifa Industrial Zone
Dubai: Jebel Ali Free Zone (North-South); Dubai Cars and Automotive Zone (Ducamz); Dubai Textile City; Free Zone Area in Al Quoz; Free Zone Area in Al Qusais; Dubai Aviation City; and Dubai Airport Free Zone
Sharjah: Hamriyah Free Zone; Sharjah Airport International Free Zone
Ajman: Ajman Free Zone
Umm Al Quwain: Umm Al Quwain Free Trade Zone in Ahmed Bin Rashid Port; Umm Al Quwain Free Trade Zone on Sheikh Monhammed Bin Zayed Road
Ras Al Khaimah: RAK Free Trade Zone; RAK Maritime City Free Zone; RAK Airport Free Zone
Fujairah: Fujairah Free Zone; Fujairah Oil Industry Zone (FOIZ)
