Dubai- April 9, 2021:

FTA released a basic tax information bulletin on Automotive Sector meant for new car dealers, used car dealers, servicing and part’s suppliers.

The bulletin clarifies that supplies made by businesses in the automotive sector are generally subject to VAT, including but not limited to:

• Sales of new and used cars
• Sales of car parts
• Service centers’ services, warranties, and related insurance products

Supplies of qualified means of transport, such as buses that are designed or adapted for public transportation of 10 or more passengers and are actually used for public transportation are, however, zero-rated for VAT purposes.

For further clarification contact our tax experts.