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Construction is complicated area for VAT implication and vast VAT rules will be applicable on this area specially in Dubai. It will create VAT jobs in UAE.
Construction cost may increase lilttle becuase of VAT implementaion in UAE. This VAT will be burden for Consumenr only. The Construction company may get Input(ITC) on VAT portion of materials cost. Overally not only construction sector but also other sector which is coming under VAT categories will affect.
The introduction of VAT is expected to result in an overall increase in construction costs, as well as in the cost of building materials. In the long term, you would expect it to have minimal, if any, impact on the sector, because most of the cost of construction projects will be fully recoverable from a VAT perspective. You would not expect any longer-term implications, it just becomes part of the business environment. I think that the tax is a positive step for the governments, and will help to grow the economy through more diversified sources of revenue.
