VAT Impact on Transportation and Logistics Sectors

Understanding the VAT impact on the Shipping and logistics industry is crucial as the UAE holds the reputation of being a leading multi-modal transit and re-export hub. The UAE caters to the logistics demand from major markets including Europe, Asia, Africa, the US, and other countries in the Middle East. The UAE has beaten stiff competition from other GCC countries due to the development of stronger infrastructure in the form of the Dubai logistics Corridor, modernization of seaports and airports, development of JAFZA, and the expansion of airports.
The VAT implication for the Transportation and Logistics industry is a fairly complex one, which is dependent upon various factors including the mode of transport and the place of supply of the goods as per the UAE VAT Law.
The provisions under the UAE VAT Law covering the transport-related services define the VAT treatment on the Shipping and Logistics industry in the UAE. As per the Article (1) of the UAE VAT Law, the transport-related services consist of
Shipment
Packaging and securing cargo
Preparation of Customs documents
Container management
Loading, unloading, storing and moving of Goods
Other related services necessary to carry out transportation
Based on the means by which the transportation is undertaken (by sea, air or road) and the place of supply (whether the transportation is within the UAE or internationally), the VAT on the logistics sector is rated as zero, standard or out of scope.
Agenda:
1. Brief of International and Domestic Transportation modes
2. Brief of Shipping & Logistics Sector
3. Challenges Faced in Domestic Transportation
4. VAT on Disbursement and Reimbursement of Agents
5. VAT on Importation of goods by Agents
6. Exit Certificates - Goods Export Documentation
7. VAT for Warehousing Services
8. Tax Treatment for Means of Transportation and Services Related to it.

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