The UAE Ministry of Finance has issued Cabinet Decision No. (127) of 2024, which extends the reverse charge mechanism for Value Added Tax (VAT) to encompass precious metals and stones transactions between VAT-registered businesses.
The new decision, which supersedes Cabinet Decision No. (25) of 2018, now covers gold, silver, palladium, platinum, natural and manufactured diamonds, pearls, rubies, sapphires, and emeralds.
The mechanism also applies to jewellery manufactured from these materials, provided the value of the precious components exceeds that of other materials used.
VAT-registered suppliers will not be required to charge and collect VAT on supplies of goods covered by the decision to VAT-registered customers, subject to meeting the stipulated conditions, the Ministry of Finance said in a statement on Friday.
Instead, VAT-registered customers must calculate and declare the VAT on their purchases in their returns.
The Ministry described the decision as “a step in the right direction,” the statement said, noting it demonstrates the government’s support for the precious metals and gemstones trading sector.
The reform aims to strengthen the regulatory framework while promoting business growth in alignment with global practices.
Follow us on
