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UAE won't delay value-added tax implementation for banks

The United Arab Emirates will implement a 5% value-added tax across all sectors from the beginning of 2018 as planned despite calls to delay it for banks and insurers, Thomson Reuters' Zawya reported, citing two senior officials from the UAE Ministry of Finance and the Federal Tax Authority.

UAE Banks Federation Chairman Abdul Aziz Al-Ghurair had requested authorities for extra time saying that banks and insurers needed six more months to prepare for the VAT.

However, there was no reason to postpone the implementation since the "banking industry is based on advanced electronic systems and all the required information was available to them," Khalid Al-Bustani, the director-general of the FTA said, adding that banking services with margins or interests will be exempted.

Younis Al-Khouri, an under-secretary at the MoF, said banks confirmed their readiness for the VAT in a meeting with authorities the week of Dec. 4, the report added.