The UAE introduced VAT with effect from 1 January 2018. It based its legislation on the GCC VAT Treaty, which is based on the EU VAT directive, and loosely on a few other jurisdictions. The rules were established in 2017. These were untouched until recently.

For the first time in 2.5 years after the introduction of VAT, the United Arab Emirates (‘UAE’) updated its legislation. The UAE’s Federal Tax Authority (‘FTA’) published an updated version of the VAT Executive Regulations (‘ER’) to the VAT Federal Decree-Law.

The updated version incorporates the changes as per a new Cabinet Decision No. 46 of 2020 (Official Gazette issue 680 of 2020 published on 15 June 2020). The updated version amends one article (article 31 (2)) and improves the English translation in a number of places (e.g., article 51 (5) and article 70 (4). It has flagged only the amendment and not the improvements to the translation. According to the UAE constitution, the amendments enter into effect one month after publication.

This article discusses the change, compares it with KSA and the EU, and analyses the practical complexities and formalities.