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UAE's Proposed Road Tax Criticized By Saudi Arabia

by Lorys Charalambous, Lowtax.net, Cyprus
22 January, 2014

A plan to tax vehicles entering the United Arab Emirates (UAE) has met with opposition from authorities in Saudi Arabia.

The UAE's National Transport Authority (NTA) plans to impose a AED100 (USD27) levy on every bus entering the Emirates, as well as a levy of AED5 per seat. In addition, the NTA has made a list of 18 goods that will be subject to a tax of AED500 per trip. Other goods are to be taxed at AED100 per truck and AED10 per ton.

However, Saudi authorities say that the tax will create an additional burden for the Kingdom's transportation sector. Saudi transport under-secretary Faisal Al Zabin informed local media that these concerns have been brought to the attention of Nazim Bin Taher, chairman of the NTA.

The tax was originally supposed to come into force in September 2013 but was put on hold. It was then due to be implemented last week, but as of January 20 drivers entering the UAE had not been asked to pay the tax.

The UAE's decision to impose the tax comes at a time when the Gulf Cooperation Council (GCC) is working to promote greater cooperation in trade. The tax would affect not just Saudi Arabia but the six GCC nations as well as Jordan, Lebanon, Syria, Yemen and Turkey.

Around 800,000 trucks cross the Saudi Arabia-UAE border every year.

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