The UAE Cabinet has decided to refund a 5% value added tax for institutions working in the exhibitions and conferences sector.
Facilities involved with organizing events have the right to refund the tax levied of providing these services. The change is intended to support the country’s status as a hub for the meetings, incentives, conferences and exhibitions (“MICE”) industry and to attract leading event organizers.
Any exhibition or meeting between people sharing the same interest that is held for seven days or less and is authorized by the competent local authority is eligible for the VAT refund provided the service recipient has no established base or permanent facility in the UAE.
The service recipient must also not be registered or obliged to be registered in the UAE and have paid any tax to the supplier.
Such a move is a welcome move which shall trim costs incurred by organizers and international associations while also enabling local associations to submit more bids for hosting major international conferences and congresses and enhancing the support of partnerships with the public and private sectors.
The MICE industry contributes around Dhs2.39bn ($650.7m) annually to the UAE economy and is anticipated to grow to Dhs5.1bn ($1.38bn) by 2020.
Last week an International Monetary Fund (IMF) official told Reuters that the implementation of the tax had gone smoothly and its impact on inflation was expected to ease.