Etisalat to charge 5% VAT on postpaid bills, prepaid usage

Dubai - VAT will be implemented across the UAE starting January 1, 2018.

Telecom company Etisalat on Thursday announced that all postpaid customers will be charged 5 per cent VAT on their monthly bill, while prepaid customers will pay VAT on the actual usage of credit instead of overall recharge card value.

Etisalat had earlier announced that it will charge customers value-added tax of 5 per cent once the regime is implemented in the UAE starting January 1, 2018.

"Etisalat is taking all efforts to be ready and compliant for the new law coming into effect and provide complete information to all customers and its effect in the future. Etisalat has already started contacting all customers to increase awareness and provide clarity on the introduction of VAT," the company said.

"The UAE leadership's vision is to build a diversified and sustainable economy and the new tax system aims to support the economic development in the country enabling it to compete with world's most advanced economies. With Etisalat taking a major step towards a great future, it is making sure that transparency is maintained by taking all necessary measures in educating customers on the new government directives regarding VAT and its impact on their telecom services."