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-   -   VAT (https://britishexpats.com/forum/middle-east-60/vat-907386/)

UKCityGent Jan 2nd 2018 6:25 am

VAT
 
So just interested to see if the VAT was implemented and if people have noticed the effects ?

jam25mack Jan 2nd 2018 7:16 am

Re: VAT
 
Yes it was implemented.... have paid a grand total of 4.25 AED so far.... massive effects!

Scamp Jan 2nd 2018 8:32 am

Re: VAT
 
AED 7.20 in Choithrams yesterday.

Fortunately, they were really organised and by 2pm when I went down there they'd managed to simply remove prices from everything and not put the new ones up.

UKMS Jan 2nd 2018 4:23 pm

Re: VAT
 

Originally Posted by UKCityGent (Post 12408810)
So just interested to see if the VAT was implemented and if people have noticed the effects ?

It has been implemented, not bought much to notice but have had emails from a couple of restaurants I use stating that they are not increasing prices but absorbing themselves.

frequentflyer1234 Jan 3rd 2018 5:12 am

Re: VAT
 
Noticed quite a few increases in the 10 - 20% range at the supermarket.

Scamp Jan 3rd 2018 5:42 am

Re: VAT
 
Manager of the local pub said they're trying to keep it to 5% on basic prices, but it's more complicated because they can't charge 5% more straight off the bat because prices include tax and service etc.

So have to remove that, add 5%, add those back on but they're then charging service on the VAT so they have to add the service to the VAT free price at the same time as adding VAT. Or something.

Then he suggested that actual rates for them are going up thanks to VAT so they might need to increase their prices again when the dust settles.

From what I see, if a business has VAT applied to the goods they sell then it's easily transferable, then the 5% added to their rates (DEWA etc), to some services they use that they can't pass on means that some of those 5%'s need to be built into their prices, so in 'real' terms the rate applied to the product at shop floor could be higher than 5% or lower. Which makes it a total minefield for the first few months.

If I were a business I'd be doing everything I can to swallow some of that cost as a possible differentiation from the competish. Difficult though, this part of the world means it's like to end up with most places plumping them 10% up and us having to swallow it.

Bit like when rent increases and general cost of living, can't see many firms just chucking an extra 5% at staff for fun.

TheShed Jan 3rd 2018 7:55 am

Re: VAT
 

Originally Posted by Scamp (Post 12409661)
Manager of the local pub said they're trying to keep it to 5% on basic prices, but it's more complicated because they can't charge 5% more straight off the bat because prices include tax and service etc.

So have to remove that, add 5%, add those back on but they're then charging service on the VAT so they have to add the service to the VAT free price at the same time as adding VAT. Or something.

Then he suggested that actual rates for them are going up thanks to VAT so they might need to increase their prices again when the dust settles.

From what I see, if a business has VAT applied to the goods they sell then it's easily transferable, then the 5% added to their rates (DEWA etc), to some services they use that they can't pass on means that some of those 5%'s need to be built into their prices, so in 'real' terms the rate applied to the product at shop floor could be higher than 5% or lower. Which makes it a total minefield for the first few months.

If I were a business I'd be doing everything I can to swallow some of that cost as a possible differentiation from the competish. Difficult though, this part of the world means it's like to end up with most places plumping them 10% up and us having to swallow it.

Bit like when rent increases and general cost of living, can't see many firms just chucking an extra 5% at staff for fun.

if we lived in a developed country, it would be a straight 5% on the price as all of their other costs should be VAT reclaimable. However, I very much doubt people here get that and even if they do, they'll ignore it and pocket the difference.

Scamp Jan 3rd 2018 8:41 am

Re: VAT
 

Originally Posted by TheShed (Post 12409693)
if we lived in a developed country, it would be a straight 5% on the price as all of their other costs should be VAT reclaimable. However, I very much doubt people here get that and even if they do, they'll ignore it and pocket the difference.

Kind of what I was getting at. All the extras the business has to pay VAT on, will it be reclaimable? Easily? Do they know this?

I read an article said the true cost to Joe Average is 3.1-3.6% increase in living cost.

kostik3000 Jan 3rd 2018 1:15 pm

Re: VAT
 
Biggest mess in our line of business, I've ever seen. It's like whole system was designed by 10 years old. I am in Maritime business and most of the things supplied to ships should be zero rated. Our incompetent finance manager doesn't help situation either.

nonthaburi Jan 3rd 2018 4:34 pm

Re: VAT
 
Not totally related but in Saudi they not only introduced the VAT, but also raised the price of 91 by 80%, and doubled the price of 95. Be interesting to see what happens to the prices of taxis, Uber, Careem etc

UKCityGent Jan 4th 2018 5:09 am

Re: VAT
 
Does this mean there is a VAT claim office at Dubai then ?


I would want my VAT back if I visited Dubai

TheShed Jan 4th 2018 6:17 am

Re: VAT
 

Originally Posted by UKCityGent (Post 12410594)
Does this mean there is a VAT claim office at Dubai then ?


I would want my VAT back if I visited Dubai

Thats an interesting point. In any normal country, they would allow tourists VAT reclaim on their purchases, ,but I read somewhere that they will specifically not refund as the Tax is intended to raise revenue and Tourism is a major source of income. In the same paper on the same day, I seem to remember that they were having a push to attract more tourists.

You cant make this 54iT up :rofl::rofl::rofl::rofl:

carcajou Jan 4th 2018 8:15 am

Re: VAT
 
Yes. Supplier quoted me basic price and then a separate add-on for VAT.

Scamp Jan 4th 2018 8:51 am

Re: VAT
 
Zataar have put delivery charge up by 20%. The b....rs

jam25mack Jan 4th 2018 9:25 am

Re: VAT
 

Originally Posted by Scamp (Post 12410675)
Zataar have put delivery charge up by 20%. The b....rs

They've stopped delivering to my office anyway so screw em..... that's despite them having a branch just the other side of SZR pretty much directly opposite my office. Dicks!


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