- Filipinos in the UAE will face a hike in money transfer fees starting January 2018
- This is because of the 5% VAT that the UAE government will start imposing next year
- UAE currency exchange houses confirmed that they will pass on the VAT charges to customers
Filipino workers in the United Arab Emirates should expect a small increase in their remittance expenses starting January 1, 2018.
The UAE will start implementing a 5% value added tax on goods and services next year.
Foreign exchange companies said they would add the cost of VAT to the fees they collect from customers. They clarified, however, that the increase will be minimal.
According to a report from Khaleej Times, the increase will range between 50 fils to Dh1 per transaction.
Mohammed Al Ansari, chairman of the Foreign Exchange & Remittance Group (FERG), said the VAT will be imposed only on the remittance fee and will not affect the amount that will be remitted.
He also clarified that it will not affect currency exchanges by residents or visitors.
Next year will mark the first time that the UAE will impose VAT. The rate is one of the lowest in the world.
The government is expecting that the new tax will help generate and estimated Dh12 billion worth of revenue in 2018, which will be used to fund government projects.