As part of efforts to cushion the economic effects of Covid-19, some owners of the biggest companies in Dubai have submitted a proposal requesting a reduction in VAT – atleast from 5 to 2 per cent – a 50% cut or postponement of VAT payment till end of the year.
In a request made to Sheikh Ahmed Bin Saeed AL Maktoum, Chairman of Dubai’s Supreme Fiscal Committee, the business owners said, “Eliminating the taxes would improve liquidity situation of companies.”
The representatives of the leading businesses in Dubai also made a proposal to accelerate payments from government agencies and their subsidiaries to contractors and suppliers.
Hoping that it would help businesses with cash flow, the letter of request sent to Sheikh Ahmed states that “The current situation makes it necessary for the government, private sector and the society to work together, hand-in-hand, to overcome challenges and emerge stronger.”
The business owners also proposed elimination or reduction of fees for issuance and renewal of commercial licences until year end.
In a addition to that, they requested a freeze on the implementation of a 2.5 per cent market fee on all establishments operating in Dubai through the rest of the year.
“The current situation makes it necessary for the government, private sector and the society to work together, hand-in-hand, to overcome challenges and emerge stronger,” the letter states.
“There should be an ongoing dialogue between the government and the private sector to be updated on all developments in view of the current exceptional circumstances,” the letter adds.
On a final note, the business owners also suggested the need to help companies return extra laborers to their home countries by financing their cost of transportation and other logistics.
