Federal Tax Authority and Planet Tax Free announce world’s most innoVATive, 100% digital VAT-refund scheme for tourists

• His Excellency Khalid Al Bustani: “The new system is part of the FTA’s proactive services
• Tourist VAT Refund transactions double to 2.31 million during the first eight months of 2022

Dubai, United Arab Emirates – 14 September, 2022: The United Arab Emirates Federal Tax Authority (FTA), in partnership with Planet Tax Free, today launched the world’s most innoVATive, 100% digital VAT-refund scheme for tourists. The paperless procedure is considered the most advanced solution of its kind in the world and is a reflection of the government’s continuous adoption of proactive solutions based on the concept of proactive government work, to meets the requirements of the future and positively reflect on customers.

The announcement was made at a joint press conference in the presence of H.E. Khalid Ali Al Bustani, Director General of the UAE Federal Tax Authority and Eyad Al-Kourdi, General Manager of Planet Tax Free, the operator of the tax refund system for tourists in the UAE.

The integrated innoVATive system was demonstrated at the press conference, showcasing the strength of using electronic invoices issued at the point of sale registered within the authority’s system, instead of traditional paper invoices. The new solution is integrated electronically between retail outlets and the tax refund scheme, ensuring a seamless digital process of issuing, sending, modifying and saving invoices for tourists.

Khalid Ali Al Bustani, Director General of the UAE Federal Tax Authority said, “The launch of the new innoVATive system is part of the authority's continuous development plans, by adopting best-in-class standards to enhance UAE’s competitiveness in all sectors, including tourism. This is in-line with the framework of the government digital strategy towards the smart transformation of its services. Furthermore, focusing on the virtual management of proactive services provides an innoVATive model that reflects the leadership and excellence of the government work system in the UAE by proactively providing services for customers, to complete their transactions easily, easily and quickly”.

His Excellency added; “UAE has succeeded in strengthening the foundations of one of the most advanced digital infrastructures in the world, thanks to the vision of our wise leadership to anticipate future strategies and improve quality of life and sustainability. The development of these services raises the overall wellbeing of society and cultiVATes happier citizens and visitors.

Encouraging innoVATion and excellence is one of the basic components of digital transformation to meet the requirements of systems integration.”

Al Bustani added; “With this new innoVATion, the electronic VAT system for tourists continues to play an important pioneering role as one of the solutions that promotes the global reputation of the UAE being the most important destination on the international tourism map due to its safe environment, hospitable people and attractive landmarks, events and diverse touristic leisure facilities. The system achieves high satisfaction rates by users for its simple, effective and smooth tax-refund process for eligible tourists”.

Tourist VAT Refund transactions increased by 104.15% during the current year, Al Bustani added, as the number of transactions doubled to 2.31 million transactions during the first eight months of this year. In 2021 1.13 million transactions were registered during the same period, The total value of Tourist VAT Refunds increased by 113.48% from the beginning of January to the end of August 2022 compared to the same period in 2021, attributing this growth to the easing of global travel restrictions.

Al-Bustani stressed that these numbers reflect a strong indication that the system is operating with great efficiency and effectiveness, which helps the flow of tourist traffic through the country's ports.

Eyad Al-Kourdi, General Manager of Planet Tax Free said, “By leveraging digitization to deliver innoVATion, visitors to the UAE can now enjoy the best tax-free shopping journey in the world, by processing and claiming refunds on VAT through seamless digital technology throughout their stay in the country.

In a matter of moments, shoppers can complete a transaction, receive a digital invoice and share it directly with Planet Tax Free. The electronic tax-refund system is integrated for purchases at a range of hotels, shopping centers, malls and other retail locations. Upon departure from the UAE tourists can use one of more than 100 self-service kiosks available at departure points, for a simple, quick and hassle-free experience.”

During the press conference, officials estimated more than 3.5million traditional paper invoices will go digital, resulting in overwhelmingly positive benefits including keeping pace with the digital transformation strategy of the country, saving merchants up to five minutes per customer (compared to printing receipts), reducing friction to maintain public health  at the point of sale and eliminating human error. The 100% paperless process will save more than 16,800 trees per year and more than 4,000 tons of carbon dioxide emissions.  

The digital VAT-refund system has witnessed many expansions and developments since its launch in 2018. The system includes integrated solutions to directly link thousands of retail stores registered with the authority and 13 air, sea and land ports. To provide more convenience for tourists the self-service tax refund was launched to complete refunds in less than two minutes. And in 2019, Planet Tax Free started the first phase of delivering innoVATion by installing self-service kiosks at airports, then at hotels and shopping malls and the departure gates of the country, followed by the launch of the merchant dashboard and the digital shopper portal.

The new paperless approach uses an entirely digital platform that integrates with registered retail merchant till systems. Customers simply scan their passport, complete their purchase and their transactions are automatically shared as a digital invoice with Planet Tax Free. Customers can also view their invoices by accessing the easy-to-view shopper portal, ensuring tourist tax-free shopping experiences are seamless, fast and digital.