UAE Introduces New VAT Rules for Precious Metals and Stones

The UAE has implemented updated value-added tax (VAT) regulations for businesses trading in precious metals and stones. The new rules expand the scope of the reverse charge mechanism, which shifts the responsibility for VAT payment from suppliers to buyers.

Key highlights of the updated VAT framework:

• Reverse Charge Mechanism: Under the updated scheme, buyers are now responsible for calculating, declaring, and paying VAT directly to the government on purchases of specified goods. This includes precious metals, such as gold, silver, palladium, and platinum, and precious stones like diamonds, pearls, rubies, sapphires, and emeralds. Jewelry containing these materials is also included if their value exceeds that of other components.

• Sector-Specific Scope: The updated regulations aim to streamline tax compliance and provide operational benefits to the precious metals and gemstones trading sector.

• Regulatory Goals: These changes are part of broader efforts to enhance the UAE’s business environment, ensuring a robust regulatory framework that aligns with global best practices and supports sectoral growth.

The new rules represent a significant milestone for the industry, reflecting the UAE’s ongoing commitment to fostering economic growth and strengthening its position as a global hub for precious metals and gemstone trading.

 

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