Finance & Capital Market

UAE recorded 2.2pc budget surplus in 2018

The UAE last year recorded a budget surplus of 2.2 percent, largely due to the introduction of the value-added tax (VAT).
The surplus compares to deficits of 0.2 percent, 1.3 percent and 6.4 percent in 2017, 2016 and 2015, respectively, said a Wam report.
Tax revenue, including VAT, amounted to 5.5 percent of the total public revenue of the UAE last year while oil revenues and the profits of public joint-stock companies accounted for 36.1 percent and 32.9 percent, respectively, according to the Ministry of Finance (MoF).
The MoF said the UAE’s decision to apply value-added tax (VAT), was positively reflected in the country’s overall budget, the report said.
The Federal Government adopted a VAT rate of 5 percent at the start of 2018, to promote economic growth in isolation from oil revenues and increase the state’s ability to continue providing educational and health services and public facilities.
Recent studies by the ministry pointed out that the budget surplus in 2018 resulted from the growth of general revenue by 13.3 percent, which surpassed the rate of public spending growth of 4.2 percent.
Total overall revenues in the government budget amounted to Dh456 billion in 2018, including tax revenues worth Dh25 billion.