Registration Requirements for Retailers in the Tourist VAT Refund Scheme

In a previous article outlining the Proposed Tourist VAT Refund Scheme within the context of UAE VAT, we elaborated on the proposed electronic system designed for facilitating tourist tax refunds. Building upon this proposal, the Federal Tax Authority has established specific criteria that retailers must satisfy to partake in this system. The Federal Tax Authority actively encourages all retail enterprises to register and integrate with the digital platform for the tourist tax refund scheme.

The Federal Tax Authority (FTA) has extended an invitation to retailers, outlets, and VAT-registered stores to join the digital platform of the tourist tax refund scheme, which is slated to Begin the operation during the last quarter of this year.

Reports indicate a highly enthusiastic response from retailers, underscoring a significant turnout for this cutting-edge tourist refund system, lauded as one of the most advanced systems of its kind worldwide.

This article will elucidate the prerequisites that retailers must meet to enroll in the tourist refund scheme and the FTA’s strategies for establishing connections between retailers and this system.

Eligibility Criteria for Enrolling in the Tourist VAT Refund Scheme:
The proposed electronic tourist refund system is being implemented in collaboration with “Planet,” the global operator of tax-free systems. The following criteria have been stipulated for retailers seeking registration in the tourist refund scheme:

1. Retailers must have a valid VAT registration with a tax registration number (TRN).
2. The goods sold by the retailer must not fall under exclusions determined by the Authority for the refund scheme.
3. Retailers must submit a participation request as specified by the FTA.
4. Retailers must meet the financial credit requirements set forth by the system operator and commit to timely tax return filing and tax payments.
5. Retailers’ membership in the tax refund scheme may be revoked if they fail to adhere to their obligations under tax laws or the agreement between the system operator and the retailer.

To streamline the retailer registration process, the FTA, in partnership with Planet, is organizing workshops and seminars. These events aim to acquaint VAT-registered retailers with the straightforward procedures for enrolling in the digital refund scheme.

As part of the initial efforts to raise awareness about retailer registration, a comprehensive awareness campaign has been conducted in collaboration with Planet, the system operator for the tourist tax refund scheme, and the Chambers of Commerce and Industry since September 2018. Up to this point, two workshops have been conducted at the Chambers of Commerce and Industry in both Abu Dhabi and Dubai, both of which have received an overwhelming response from businesses.

The system operator, “Planet,” will establish agreements with retailers to provide them with the necessary technology for participation in the scheme, linking these businesses to the digital systems of the Federal Tax Authority, as well as airports, land, and seaports.

In order to increase the number of registrations, the FTA has developed an extensive plan to introduce the new scheme, including its registration prerequisites and conditions. This encompasses induction programs accessible through the FTA’s official website.

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