Expat

Abu Dhabi May Increase Its Municipality Tax

Abu Dhabi Rent

Expatriates in Abu Dhabi could be soon be subject to a rise in municipality tax, it was reported last week.

Expatriates in Abu Dhabi could be soon be subject to a rise in municipality tax, The National reported last week.

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A circular drawn up by the emirate’s Executive Council, which was seen by the newspaper, outlines plans to increase the tax, which currently stands at 3% of a dwelling’s annual rental value.

The tax has been in effect since last year and is collected through monthly utility bills.

The proposed new rate isn’t specified, but there could be different levels for villas and apartments.

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Dubai has a similar municipality tax, which is set at 5% of a unit’s annual rental value. The money is also collected through monthly utility bills.

The move to charge municipality tax, and perhaps increase it, reflects the UAE’s drive to diversify sources of government revenue. The 5% value added tax (VAT) on sales transactions was introduced in January as part of this push.

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