VAT has to be applied even on price discounts: FTA

By Angel Chan

ABU DHABI 5 February 2018:  The Federal Tax Authority (FTA) has explained that the final reduced or discounted prices for goods on promotional offers must include the 5% Value Added Tax (VAT), which is to be calculated as included in the new price after reductions by the sales outlets or service providers themselves.

In a new awareness message issued targeting consumers and service recipients in the UAE, the FTA said that in cases of discounts on regular sale prices, or during seasonal discounts and “buy one get one free” promotions, VAT must be included in the final amount to be paid after deduction includes VAT as per the reduced amount.

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