UAE telecoms company Etisalat is clarifying the recent price changes of its pre-paid recharge cards, purchased by thousands of phone users daily. Here are the details…
VAT in UAE: No price increase on recharge cards
To ensure customers have enough balance when subscribing to packages and bundles, Etisalat has introduced five new denominations of recharge cards sold at AED 30, AED 55, AED 110, AED 210 and AED 525.
The 5% VAT that Etisalat collects on behalf of the government only applies on actual usage, not on the pre-paid recharge cards’ value. Pre-paid users will not pay any extra fee when they recharge.
Customers are being cautioned to only pay for the value of the recharge card. If you’re purchasing a AED 30 card… you should only be paying AED 30. Remember, VAT is only levied on actual usage. Customers are also encouraged to report any unwarranted price increases due to VAT.
What comes next…
The introduction of VAT in UAE will no doubt raise issues between merchants and consumers as the system rolls out. Though most expats are already familiar with VAT in their home countries, the thought of adding another 5% to many daily purchases is something that’ll take getting used to. For now, we recommend paying closer attention to your receipts to ensure that VAT is being charged according to the law.
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