If you intend to take your family to an amusement park or any other entertainment facility, get ready to shell out more from next year. Set to be introduced in the UAE from January 2018, the five per cent value-added tax on entertainment will result in an increase in the cost of water and theme park tickets in the UAE if the companies decide to pass on the tax burden to consumers, say tax experts.
Girish Chand, director at MCA Management Consultants, is of the view that there is no exempt category in the entertainment sector, hence all activities of the entertainment industry would come under VAT.
According to Najam ul Saqib, an auto spare parts businessman with operations in Ajman and Dubai, the tax may prompt people initially to cut their entertainment budgets but it will be for a short period only.
“The residents will adjust their budget. Those who’re going to theatres three times a month will now go twice, but will not substantially cut their entertainment budgets. Initially, when Salik was introduced in Dubai, people took different routes but later they realised that it costs them more in terms of fuel and time lost on roads; but now majority uses Salik. Similarly, VAT will also be part of the residents’ life and their spending will match their previous levels,” he added.
Source Credit: Khaleej Times
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