IMPACT OF VAT REFUND ON EXHIBITION AND CONFERENCE
The Cabinet after reviewing the Constitution, the Federal Decree Law No (1) of 1972 of the Competencies of the Ministers and Powers of the Ministers and it’s amendment, Federal Decree Law No 8 of 2017 on the VAT, Cabinet Decision No 52 of 2017 on the Executive Regulation of Federal Decree Law No 8 of 2017 on VAT had issued Cabinet Decision No 26 of 2018 on the refund of VAT paid on services provided in exhibitions and conferences which had to come into effect on the date of issuance.
This Decision has been introduced with an aim to help Dubai to retain its competitive edge regionally and to position it as a bigger player on the global level as the refund money would be pumped back into the industry for various purposes such as marketing and for generating more economic activity.
CASES IN WHICH VAT REFUND IS ALLOWED
This refund is allowed in case of any exhibition, conference , meeting etc which is held for a maximum period of 7 days under a licence obtained from a competent local authority in the UAE . Furthermore the recipient has not registered or is not required to be registered for VAT in the UAE and does not have a permanent fixed establishment or place of establishment in UAE and has also not paid VAT on these services .
IMPACT OF THE REFUND
The VAT refund would however:
- Attract foreign companies and business tourists all around the year in Mice Events that take place in the UAE
- It would enhance the competitiveness of the industry and would increase the capacity to attract niche global events, exhibitions and conferences.
- The costs that are incurred by the organisers and the international associations would also be trimmed and would also enable the local associations to submit more bids in order to host major international conferences and congresses.
- This would further help in growth of the market size that would help the events to come closer to other global mice destinations such as Las Vegas .
- As a result of this government initiative, the exhibition companies would have more money at their disposal and would also contribute towards marketing the events and would generate more activity in the country.
- REVISION OF FEE STRUCTURE
- As a consequence of the VAT refund, the fees for the exhibition would also come down and as a result of which , there would be more exhibitions.
Thus the refund would ensure competitiveness of the MICE Industry in the UAE and would also make sure that the industry goes back to before January 1, 2018 thus not making it overburdened by VAT. Further, it’s beneficial effects would impact business, hospitality and logistics provider in a positive way who would further pass the savings to the clients .