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What you need to know now
This is a 2019 revenue forecast, preserved as dated business news. It is not a current revenue statistic or a compliance rule.
The original article is preserved below as a historical record. Earlier deadlines, rates, offers and approval statements should not be used as current guidance.
- Forecasts should retain their original reference year.
- Revenue projections do not determine a business’s VAT rate.
- Use legislation for current obligations.
Read the forecast in its original period
The article contains economic commentary and expectations published in 2019. A forecast made then is not evidence of the amount collected in 2026, and an anticipated increase is not a confirmed outcome. Retain the original reference year whenever quoting it in a presentation or business plan. If a current figure is needed, obtain the corresponding official publication and identify whether it reports actual collections, a budget estimate or a projection.
Separate fiscal commentary from business obligations
National revenue growth does not determine an individual company’s VAT registration requirement or the treatment of a particular supply. Those questions come from the applicable law, transactions and registration position. A business should not increase or reduce its VAT charge because it reads that government revenue is rising. Use this historical item to understand discussion at the time, and use the linked official VAT material for operational compliance questions.
Use forecasts carefully in planning
When preparing a business forecast, keep assumptions about market demand, sales growth, VAT cash flows and operating costs distinct. A national tax-revenue projection may reflect several economic factors and cannot establish how a particular sector or business will perform. Show the year, source and assumption behind each figure. If a historic forecast is useful as a comparison, place it alongside an appropriate later official outcome rather than silently relabelling it as current information.
Maintain a practical VAT management view
For day-to-day decisions, focus on records the business controls: classified sales, purchase evidence, return reconciliations and the timing of cash receipts and payments. Separate tax collected on customer invoices from revenue earned by the business when analysing margins. Investigate unusual movements through transaction data rather than attributing them automatically to an economy-wide trend. This approach makes the old commentary useful context without allowing dated forecasts or registration counts to become present-day compliance instructions. Label a chart clearly as historical forecast, actual outcome or current assumption so readers understand what the figures can and cannot demonstrate.
YOUR NEXT STEPS
A practical way forward
- 01
Step 1
Identify the date and forecast period before quoting.
- 02
Step 2
Separate economic commentary from tax compliance.
- 03
Step 3
Use current official publications when preparing a new report.
CLEAR ANSWERS
Frequently asked questions
Is the forecast a verified 2026 collection total?
No.
Can this article determine my registration obligation?
No. Use the current registration rules.
Read the original article First published 30 July 2019 · retained for context
This earlier article is preserved for context. Its rates, deadlines, approvals and announcements may have been superseded. Use the current guidance and official references on this page for your next step.
UAE VAT Updates – VAT revenues set to grow
UAE VAT Updates – VAT revenues set to grow: UAE VAT collection set to grow 30% to Dh35 billion in 2019
VAT revenues would easily be Dh35 billion-plus this year: Greater compliance due to new legal aspects such as country-by-country reporting and Base Erosion and Profit Shifting (Beps), increased spending for Expo 2020, and more companies listing for value-added tax (VAT) will help the UAE to increase its revenues through VAT by up to 30 per cent this year. UAE’s VAT collection is expected to increase by Dh8 billion or 30 per cent in 2019 to reach Dh35 billion as compared to Dh27 billion last year.With increased Expo 2020 spending, VAT revenues would easily be Dh35 billion-plus this year. The way Expo is being marketed by Dubai, naturally the spending and consumption will increase which will enhance tax collection in the UAE.
The Federal Tax Authority’s latest figures showed that the number of businesses and tax groups registered for VAT surpassed 307,000, while the number of those that registered for excise tax totalled 724. The user base for the tax system is expanding rapidly, hence the clearing and forwarding companies increased to more than 123 while accredited tax agents increased to 395.
The UAE and Saudi Arabia levied five per cent VAT on goods and services from January 1, 2018 as part of a framework agreed upon by GCC members. The UAE collected Dh27 billion through VAT revenues last year, surpassing its last year’s target of Dh12 billion and event 2019 target of Dh20 billion in the first, thanks to high compliance ratio and awareness campaigns by the Federal Tax Authority and ICAI.
Dubai received the largest share of VAT receipts at 42 per cent followed by 30 per cent for federal government, 18 per cent for Abu Dhabi, six per cent for Sharjah and four per cent for other northern emirates. The list of designated zones has been increased to 25 following the addition of three new free zones – Al Ghail Industrial Zone, Al Hulaila Industrial Zone and Al Hamra Industrial Zone – in Ras Al Khaimah. In addition, seven charity organisations have been included in the list which can recover input tax, taking the total to 164 charities in the country.
The UAE has massively implementing technology at both government or private sector level, which helped compliance level to surpass expectations.Small to medium to large organisations showed their readiness to absorb the VAT in 2018 and refined their systems to make it VAT compatible. Seeing the high degree of compliance last year, there won’t be many new businesses who have to start paying VAT now on. Law and practice are getting familiar and matured and as result, there won’t be significant new inflow into tax net. So the growth in VAT collection will be a composite factor of GDP growth, enhancing volume trade and service activities.Retail, hospitality, aviation and shipping are tending to grow. To achieve the Expo 2020 goals, more commercial activities will have to take place. Put together, it will contribute about 25 per cent in VAT collections in 2019.
VERIFY THE DETAIL
Official sources & further reading
Source checks support this general guide. Your treatment depends on the facts, tax period and applicable legislation.
