What is tax?
Taxes are the charges that are imposed on the people by the government. The basic reason behind collecting the taxes from the citizens is to raise the funds for the welfare of the country. Sometimes it becomes necessary for the countries to collect the funds from the citizens so that the basic needs of the citizens can be fulfilled. In other cases, the taxes are taken to bring more welfare to the people.
There are different types of taxes that are imposed on the people including sales tax, wealth tax, income tax, excise tax and so much more. More the taxes more will be the revenue generated for the people. Tax agents in UAE can also help the companies for filing taxes.
Professionals, businessmen and even expats living in the Middle East (UAE) have different tax structures, brackets, rules and regulations. For example, the taxes for expats are not the same as they are for working professionals from other countries or the native population in Dubai. This means that you should be right on top of your tax game to ensure you do not get into any trouble with the authorities later on.
Here we will discuss what excise tax and the sales tax are?
Excise tax
When the items are produced or manufactured in the country itself, the excise duty is implemented on them. The manufacturer is supposed to pay an excise tax to the government after the transference of goods to the market. The production tax or excise tax is paid upon the manufacture of any product when it is taken to the market from the industries. This shows that the end customers will only be responsible for paying the excise tax.
It is to be noted here that the excise tax will only be imposed on the products and items that are produced in the UAE and not the ones that are imported.
Be sure about the fact that there is a difference between custom duty and excise duty. The customs duty is levied on the products that are manufactured outside the UAE.
Certain goods are levied from the excise tax.
Sales Tax
Now that we know that excise tax is to be paid by the manufacturers, the sales tax is to be paid by the consumers or end clients. Just like there is a need to pay the tax during manufacturing, there is a need to pay the taxes during buying it too.
The sales tax is imposed on the sale as well as the purchase of various items within the UAE. There might be different rules in different emirates in UAE which may make the amount of levied sales tax different too.
Differences between Excise Duty & Sales Tax
Excise tax is paid on the production of goods whereas sales tax is paid on the sale of the goods
The manufacturers of the goods pay the excise tax whereas the end customers pay the sales tax
When the goods are removed from the factory after being manufactured, the excise tax is paid whereas when the customer buys the product from the market, he pays the sales tax on it
Consulting the tax agents in the UAE
No matter what type of tax has been implemented on you, you must pay the taxes on time. You can also consult the tax agents in UAE for filing the tax returns and more. They will help you out during the whole process.
Leave a Reply