Zero Rate on Covid Combating Medical Supplies

Zero Rate on Covid Combating Medical Supplies

The UAE Government have been taking essential steps to fight the on-going pandemic and have been implementing steps to ensure the public and business isn’t much affected while tightening the restrictions and the safety laws in the Emirates. Midst of the rise in Covid-19 cases in recent days, we were treated with good news recently as we saw the country reopened the Schools after months of closure. Also, some places of worship in industrial areas of Dubai emirate were also open to worshipers with necessary safety measures in place.

Healthcare services which aimed at treatment of humans, including medical services, preventive health care services (e.g. Vaccinations) and dental are zero rated value added tax. But, there are also situations when medical supplies are considered to be standard rated;

  1. When it is business to business supply.
  2. When it’s not preventive healthcare service (e.g. cosmetics, plastic surgery etc),
  3. To those medications that are not approved by Ministry of Health and Prevention.
  4. To those medicines and medical equipment’s which are not listed in cabinet decision.

Medical supplies like face masks, sanitizer etc. was considered under standard rated before the cabinet’s resolution on 1St September 2020.

Even then, at the peak of Covid-19 cases in the country a few months ago the UAE Government had allowed business to claim the tax credit on the essential medical supplies to support business and in-turn reduces the daily rise in cases. Recently on 1st September 2020, the UAE Cabinet adopted another resolution in order to curb the spread of Covid-19. Medical equipment’s like disposable suits, hand sanitizers, face masks, respirators for air purification and gloves which is essential for fighting Covid-19 will now enjoy zero rated value added tax in UAE. Even though it seems as a subtle change, it was welcomed greatly by the health care sector.

UAE has been setting an example for the rest of world by managing the spread. The country is using advanced technologies to speed up the testing and contact tracing process. The Government hasn’t failed to take this opportunity to built relationship with other countries by sending in medical staff, supplies and other aid during crisis like this.Thanks to the front line heroes UAE has turned the corner in the fight against the pandemic and the end of the crisis in the country is in sight.

For any further information or queries relating to VAT tax in UAE or you need VAT consultants in Dubai, feel free to contact us on +971 50 104 2665 or at info@horizonbizco.com

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