UAE, 11 January, 2025 : The UAE Ministry of Finance has announced the expansion of the reverse charge mechanism to include precious metals, stones, and jewellery under VAT-registered businesses. This update, issued through Cabinet Decision No. (127) of 2024, replaces the earlier Cabinet Decision No. (25) of 2018, which applied to gold and diamonds among registered dealers.
Under the new provisions, VAT-registered businesses supplying gold, silver, palladium, platinum, diamonds, pearls, and jewellery made from these materials no longer need to charge VAT to other VAT-registered customers. Instead, the buyer is responsible for calculating and reporting VAT in their tax returns.
The reverse charge mechanism aims to simplify VAT compliance, reduce administrative burdens, and boost the trading sector for precious metals and stones. This decision reflects the government’s commitment to fostering growth in the sector while aligning with global best practices.
By shifting the VAT compliance responsibility to buyers, the updated rules create a more business-friendly environment, allowing traders to focus on their core operations. The Ministry of Finance emphasized that these changes are part of the UAE’s broader efforts to enhance its regulatory framework and support a thriving trading sector.
This move underscores the UAE’s dedication to competitiveness and economic prosperity while ensuring its regulations remain aligned with international standards.
Source : www.gulfnews.com
