# VAT and DEWA



## QOFE (Apr 28, 2013)

Nobody moaning about this yet?

UAE to tax water and electricity at 5 per cent | GulfNews.com

The DEWA bills are already expensive enough with the five percent housing charge (I call it council tax) but to have to pay an additional five percent VAT is starting to make one wonder is this "tax free" country really worth it any longer?

It would feel dear enough in an apartment; how do you villa residents feel about it?

I've made enough sacrifices living here but when the expenses just keep on going up I find it hard to justify putting up with various things that we have so far (and counting...).


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## Reddiva (Feb 24, 2016)

QOFE said:


> Nobody moaning about this yet?
> 
> UAE to tax water and electricity at 5 per cent | GulfNews.com
> 
> ...


I have never considered the UAE "tax free". Income tax free yes but tax free no
It will not make a huge difference to me just an increase of 22AED a month however to others it will be a huge dent. The cheap, good times were never going to last and many made hay whilst the sun shone. I predict many leaving but then more will come to fill those gaps.


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## Chocoholic (Oct 29, 2012)

Also the VAT that's now going to be put on ALL food items. Before essential items were going to be exempt. Sadly this is going to hit the low income bracket residents very hard. Lots of my friends threw in the towel a long time a go. There are far cheaper places to live than the UAE now.


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## TallyHo (Aug 21, 2011)

I was surprised when VAT was added to all food. I could understand types of food but all of it? 

It's just a matter of time before UAE becomes highly taxed. Perhaps not to Western levels but comparable to Singapore. China, I believe, levies a flat income tax on all expats and that will likely happen. It'll start at 5% of earnings, then steadily increase till probably around 20%.


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## rsinner (Feb 3, 2009)

Everyone who says that it will only increase prices by X AED forgets the impact it will have as 5% of everything. (So for me I think it will easily be another 500-1000 AED per month).

I can assure you that we will also see a lot of price rises. 

if my employer does not take this into account next year, they will have a very disgruntled employee. (but who am I kidding, I will not leave - India is more pathetic).


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## Horus_88 (Mar 11, 2014)

on a darker side, 2018 may witness an increase in oil prices.


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## Dave-o (Aug 23, 2015)

QOFE said:


> Nobody moaning about this yet?
> 
> ...
> 
> I've made enough sacrifices living here but when the expenses just keep on going up I find it hard to justify putting up with various things that we have so far (and counting...).


No point in moaning about it, it's coming whether we like it or not. The choice is either suck it up or do something about it. 

I know what you mean about making sacrifices to live here, 5% VAT plus 2% inflation plus another 0% pay rise will probably be the tipping point to become yet another one throwing the towel in. The financial benefits no longer outweigh the personal sacrifices


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## ThunderCat (Oct 28, 2015)

I know many friends who discuss trying to save 5% on everything to compensate, including the DEWA bill of course.

They don't consider the 5% housing tax a tax. Try to call or email them and mention housing tax, they will reply back that they don't know what you're talking about. You have to mention (fee) not tax.

Imho, nobody will leave over this, we will all just suck it up nice and sweet and they are betting on that.

If money is flowing out of UAE as remittances then surely they can squeeze 5-10% more out of our pockets (I believe this is how they think).


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## Dave-o (Aug 23, 2015)

ThunderCat said:


> ...Imho, nobody will leave over this, we will all just suck it up nice and sweet and they are betting on that...


You're right, not purely because of this, VAT is another factor in the push-pull balance of decisions that brought us here in the first place and one day will send us either home or on to the next country.

For me, the tipping point is very close. Financially, the last few years have far outweighed anything I could have achieved at home. Lifestyle-wise, the financial benefit is no longer outweighing the sacrifices and realising that life is more than just pound coins in the bank.


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## twowheelsgood (Feb 21, 2013)

TallyHo said:


> I could understand types of food but all of it?


Yes, its much simpler to have VAT on all food than try and have some included and some not included as it massively increases the burden on the State keeping a list of what is and isnt taxable.

In the UK, millions in legal fees were wasted to decide if a Jaffa cake is a biscuit or a cake as one has VAT and one does not, which isnt a good use of money.

https://en.wikipedia.org/wiki/Jaffa_Cakes#Categorisation_as_cake_or_biscuit_for_VAT

Taxes are always best kept simple.


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