TAXATION IN THE UAE (DUBAI)
The United Arab Emirates (UAE) is a very rich promising country with a high standard of living and a rapidly developing economy. Today, the foundation of the UAE's prosperity is not only its vast oil and gas reserves, but also many other industries, including the property market and construction, advertising and management, and the financial and banking sectors.
Working in Dubai attracts hundreds of thousands of migrant workers from all over the world. It is the largest city in the United Arab Emirates, located on the shores of the Persian Gulf. It is the most important economic and financial centre of the state. More than 75% of the UAE labour force consists of foreigners, so the issue of taxation is considered very relevant.
Next, let's find out what taxes are in force in the UAE in 2025.
Important. According to the official information of the UAE government portal, the country does not charge income tax from individuals. However, there is a corporate tax on oil companies and foreign banks here. Excise tax is levied on certain goods that are generally harmful to human health or the environment. And value added tax applies to most goods and services.
TYPES OF TAXES IN THE UAE
Excise tax in UAE
Excise tax was introduced in the UAE in 2017. It is a form of indirect tax levied on certain goods that are generally harmful to human health or the environment. These goods are referred to as ‘excise goods’:
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Carbonated drinks
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Energy drinks
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Tobacco and tobacco products
From 1 December 2019, excise tax is also levied on:
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Electronic smoking devices and instruments
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Liquids used in such devices and instruments
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Sweetened beverages
The rate of excise duty in the UAE According to Cabinet Resolution No. 52 of 2019 on Excise Goods, Excise Tax Rates and Methodology for Calculating Excise Price is:
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50% on carbonated beverages
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100% on tobacco products
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100% on energy drinks
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100% on electronic smoking devices
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100% on liquids used in such devices and instruments
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50% on any product with added sugar or other sweeteners
The UAE government levies excise tax to reduce the consumption of unhealthy and unhealthy products and to increase government revenue that can be spent on useful public services.
VAT in the UAE
Value Added Tax (VAT) was introduced in the UAE from 1 January 2018. A rate of 5 per cent is levied at the point of sale. VAT will provide the UAE with a new source of revenue that will continue to be utilised to provide high quality public services. It will also help the government move closer to its vision of reducing dependence on oil and other hydrocarbons as a source of revenue.
VAT refund for tourists in the UAE
Tourists and visitors can claim a refund of VAT paid on purchases made during their stay in the UAE. The refund will be made through a fully integrated electronic system that connects retailers registered with the ‘Tax Refund Scheme for Tourists’ to all ports of entry and exit in the UAE.
From 18 November 2018, tourists in the UAE can request a refund of value added tax paid on their purchases while they are in the UAE. Planet is the exclusive operator of the tax refund system for travellers, which is administered by the UAE Federal Tax Authority.
Conditions for tourists to apply for a VAT refund:
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Goods must be purchased from a retailer participating in the Tax Refund for Tourists programme.
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The goods are not excluded from the Federal Tax Authority's refund scheme.
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The tourist must have a clear intention to leave the UAE within 90 days from the date of delivery together with the consumables purchased.
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The tourist must export the purchased goods from the UAE within three months from the date of delivery.
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The process of purchasing and exporting goods must be carried out in accordance with the requirements and procedures established by the Federal Tax Authority.
Tourist tax in the UAE
In the UAE, restaurants, hotels, hotel apartments, resorts and so on may charge one or more of the following taxes:
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10% tax on the room rate
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10% service charge
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10% municipal taxes
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6 to 10% city tax
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6% tourist tax
In Dubai, hotels charge a ‘tourist dirham’ per room per night of stay (maximum 30 consecutive nights) of between AED 7 and AED 20 depending on the category/class of the hotel. In May 2016, it was announced that hotels in Abu Dhabi will charge a new surcharge of 4 per cent of the hotel rate and AED 15 per room night. In Ras Al Khaimah, hotels will charge a tourist surcharge of AED 15 per room per night.
Property tax in the UAE
In all Emirates except Abu Dhabi, rental of residential property is taxed at a flat rate of 5%. Commercial property rentals are taxed at a rate of 10%. Abu Dhabi does not levy council tax on rented premises, but landlords are required to pay licence fees.
Jobs in the UAE for foreigners in 2025 are traditionally available in tourism, construction and medicine. Specialists in logistics, trade, real estate and oil and gas are often required. The official minimum wage in the country is not established. But in general, this figure is rarely below $800 per month. The average salary in Dubai is about 4,000-5,000 thousand dollars monthly. The standard working week in the UAE lasts from Sunday to Thursday.
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