The DTS is a newly introduced compliance program applicable to manufacturers and importers of tobacco and tobacco products. The DTS will deliver unique pack marks to allow product tracking and traceability from the point of manufacture through to final Emirate of distribution, and to support the enforcement activity targeting the reduction in illicit tobacco trading. For the time being, DTS will apply to cigarettes.
The DTS Solution will require the manufacturers to apply specific high security control markers (stamps) and digital codes to all packs, with the principle aims of the DTS System being:
• To enhance the FTAs ability to control excise taxes on cigarettes sold in the UAE, following importation or local manufacture.
• To enhance the control of Excise Tax collection and give the relevant Authorities the ability to analyze and audit the supply chain to better identify the trade in illicit tobacco products.
• To meet the compliance standards laid down by the WHO’s Framework Convention on Tobacco Control (FCTC) through the enabling of tracking and traceability of compliant tobacco products.
Why Is the UAE implementing a digital tax stamp (DTS) scheme?
To support the Excise tax initiative for the tobacco products, a Digital Tax Stamp (DTS) control solution is being introduced, the purpose of which is to enable the FTA to raise compliance standards for tobacco products produced or imported into the UAE, focus enforcement activity on the illicit trade market, and also ensure that the income generated from the legal and compliant manufacture or importation is successfully distributed to the appropriate Emirate.
What products will fall under the DTS?
The scheme will initially focus on cigarettes from 2019, and will extend in time to include all tobacco-based products.
Communication of the timelines for non-cigarette based tobacco products will follow in the future.
Information relating to any further products and categories to be added to the scheme will be communicated in the future.
Who will be required to register for DTS?
Manufacturers - Any UAE-based or Overseas/International Cigarette Manufacturer that sells its products via importation into the UAE for EITHER domestic sales or sales via UAE Duty free outlets (airports and ports).
Importers – ANY officially licensed IMPORTER of RECORD who purchases Cigarettes in bulk from domestic or international manufacturers and undertakes to on-sell and distribute within the UAE mainland or UAE Duty Free markets.
Distributors / Supply Chain Agents/ Warehouse keepers – ANY official distributor that will be the recipient of formally imported goods for sales in domestic market or sales via UAE Duty
When will the scheme go live? And what are the key milestones?
1st Jan 2019
Importers and UAE-based Manufacturers will be able to order stamps to be sent to the Manufacturers for application to the pack of cigarette products.
1 May 2019.
No cigarette products without a digital tax stamp will be permitted to be imported into the UAE.
1st August 2019
No cigarettes will be allowed to be held out for sale, imported or produced anywhere in the UAE unless they carry a Digital Tax Stamp.
All cigarettes produced or imported into the UAE after this date must have a Digital Tax Stamp with end-to-end traceability.
All cigarettes manufactured or legitimately imported with a digital tax stamp (without end-to-end traceability) between May 1st and August 1st may remain in market beyond this date.
Timelines for other tobacco products to be added to the scheme will be communicated in due course.
What Global legislation and standards are behind the DTS scheme?
Tobacco companies are already used to applying track and trace technology for their products. The solution we are applying in the UAE
• Is compliant with the Global standard for tobacco supply and distribution – the United Nations World Health Organisation’s Framework Convention on Tobacco Control (FCTC) protocol.
• Is delivered in partnership with De La Rue, the world’s leading anti-counterfeit company.
• The stamp itself contains world leading anti-counterfeit secure features – both visible and invisible.
What actions will be taken against importers, manufacturers and distributors who fail to comply with the scheme?
We expect all cigarettes in the UAE to carry a tax stamp. There will be penalties for non-compliance with the scheme.
How will the scheme actually work in practice?
• The authority will license all manufacturers, importers and distributors to trade in the UAE.
• With this license in place, the importers/ local manufacturers will be able to order tax stamps.
• Unique tax stamps will be allocated and dispatched to the manufacturers, with each stamp having a digital ‘twin’ (a unique code) with the stamp, and the coding being applied on-line to individual packs during the cigarette manufacturing process.
• Manufacturers will submit the details of stamps and codes used to the central database and retain this information for reporting usage and intended export shipment data to the FTA.
• The authority will be informed when batches have cleared customs.
• Law enforcement will check throughout the supply chain that the tax stamps are in use
When will affected businesses be able to register for DTS/Where can I find registration forms?
In order to register for DTS, excise registered businesses need to complete a form (visit URL) and send it to the customer care team mailbox to ask for access(ftadtscustomercare@delarue.com).
The Customer Care team will then process the request and provide the importer/manufacturer with relevant and tailored access to the Certify system. The DTS system for ordering Tax Stamps will go live on 1st Jan 2019.
What is the process of ordering the stamp?
Stamps will be ordered in the DTS system via a simple login and order management process which will be menu driven. When placed an order will be ratified by the FTA to ensure its veracity and completeness, and this will then trigger direct engagement with the intended recipient of the stamps (the Manufacturer).
For an importer to create an order, they need to:
• Log on to the DLR Certify System
• Enter their User Name and Password
• Go to the ‘Manage Orders’ Section where they will be able to record key information relating to the order, including the market the order is for (for UAE or Duty Free, the product type (cigarettes initially) and the Product Code.
A step by step training manual will be shared in the training session.
For any further questions, please contact the Customer Care team at ftadtscustomercare@delarue.com
What is the validity period for the stamps?
The validity period for stamps as decreed in the legislation is 12 months.
Are there any limitation of number of stamps that can be ordered?
There are no limitations in place, however it will be worth noting that stamps are to be delivered in specific Minimum Order Quantities (MOQs) dependent upon the format of supply required: Reels, Sheets, Bundles. The MOQ requirements for each of these formats are as below:
Reel 30,000 Stamps (per single reel)
Sheets 240 Stamps (per single sheet
Bundles 70,000 (per box of bundled stamps
How do key manufacturers/distributors raise concerns or issues relating to the scheme, or have key questions addressed?
The FTA and its partner De La Rue are on hand to deal with any on-going issues and questions.
A Customer Care team is being established to handle all queries and can be reached at ftadtscustomercare@delarue.com.
What help will retailers get from Manufacturers, Distributors and the Authority?
It is the responsibility of importers and manufacturers to ensure that the only products supplied into the UAE will be ones that carry tax stamps along with the approved encoding requirement at this time.
Law enforcement officers will be checking throughout the supply chain that this is the case.
What will happen to retailers who sell tobacco without a tax stamp?
We expect all cigarettes sold in the UAE from August 1st 2019 to carry a digital tax stamp.
There will be a penalty put in place for non-compliance, the details of which will be communicated in due course.
How will consumers know what to look out for?
Consumers should look for both the presence of physical stamps and digital codes on the products purchased in within the UAE.
What consumers should do in case they find cigarettes pack without codes?
Consumers should look for both the presence of physical stamps and digital codes on the products purchased.
If a consumer believes that a pack of cigarettes is without mark and code, then they should notify the FTA where they purchased the pack from, so the appropriate action can be taken. This is likely to involve action against the retailer, importer and manufacturer but will not impact the consumer.
Can Tourist Refund Scheme claims be validated 24/7 at all locations?
Validation will be available 24/7 and refund desks will be open at major airports 24/7.
Who will provide the refund under the Tourist Refund Scheme at the airport?
You can find a list of cash refund points on planetpayment.ae. Planet will process credit or debit card refunds.
Is a refund under the Tax Refunds for Tourists Scheme permissible on partially consumed goods? (Dates, chocolates, perfume)
No.
Is a Refunds for Tourists Scheme permissible on partially used goods? For example, I start using my iPhone or have used perfume.
Yes (e.g. smartphones) as long as they are accompanied by the original packaging when validating their export at the exit point. A perfume that has been opened however is not eligible for a refund.
What happens if 5 boxes are on the Tax Free Tag, one box is consumed and 4 other boxes are exported?
The refund may only be claimed on the 4 boxes that are being exported.
Will tourists also pay VAT?
Purchase of goods and services by tourists in the UAE will be subject to VAT. However, tourists will be eligible to reclaim the VAT incurred on their purchase of goods under the Tax Refunds for Tourists Scheme subject too meeting certain conditions.
Is there a special refund for business visitors?
Yes. Further details are available in the VAT refund for business visitors user guide.
How can someone access UAE Tax legislation?
All Federal Tax Laws, Executive Regulations and Cabinet Decisions are published under the “Legislation” section on the FTA website.
What other taxes is the UAE considering?
As per global best practice, the UAE is exploring other tax options as well. However, these are still being analysed and it is unlikely that they will be introduced in the near future. The UAE is not currently considering personal income taxes, however
If the tourist does not have their passport details on them at the time of purchase, can the tax refund form be issued?
No, as a minimum, the original or copy of the passport or GCC ID details are needed.
If the tourist has purchased goods and lost the invoice, can they come back to the merchant to issue a new Tax Free Tag?
No, as the purchase invoice is required (the Tax Free Tag is attached to the purchase invoice).
Is it necessary to issue a Tax Free Tag for a tourist to get a refund?
Yes, a Tax-Free Tag must be attached to each invoice to obtain a tax refund.
Is the tourist expected to have the original passport?
The preference (for better customer & merchant experience) is that the tourist presents their original passport / GCC ID at point of purchase. However, a clear copy would suffice of the passport / GCC ID number and tourist details. For validation at the point of exit, the original passport or GCC ID must be presented.
Is there any refund for services i.e. watch repair etc.? What if a part has to be purchased for repair?
No.
Can I claim a refund if the payment is made by my friend or relative using cash or credit card?
Yes, as long as the tourist exporting the goods is present during the purchase, and it is the exporter's information that is completed for the VAT refund.
Can one claim the refund before getting to the point of exit from UAE?
No.
If the refund is above AED 10,000, can the tourist claim a cash refund at the airport?
The tourist can get a refund in cash up to AED 10,000, for all the Tax Free Tags that add up to that amount (or less). Once they pass that amount, the remaining tags must be refunded by credit or debit card only.
How many days will it take for a credit card refund?
Card refunds are typically processed by Planet within 10 days, excluding the bank's or credit card company's own processing times.
Is a cash refund available on both the airside and landside at airports?
Where available, a cash refund will only be given at the airside.
Is there any additional cost to get a refund on a credit card by Planet or my bank?
There would be a standard currency exchange rate that would be applied to convert funds into the cardholder's currency (where currency is not AED).
Is there any charge for a refund in cash?
There is no charge for a refund in cash. However, if a tourist wishes to exchange the refund from AED into another currency, the Cash Refund Agent's advertised exchange rates would be applied.
What happens if there is no cash refund counter at the border point?
The refund will be made by credit card, debit card or e-voucher where applicable.
Who does the tourist need to contact if there is a delay in the refund?
Tourists are advised to track their refund by scanning the QR code on the Tax Free Tag using a smartphone, and that will take them to a unique tracking page to see further details. If further assistance is required, the tourist can contact the Planet Customer Services team.
Does the tourist have to present Tax Free Tags at the time of refund when leaving the UAE?
The invoice must be attached to the Tax Free Tag and presented at the airport as part of the refund process. If not, the tourist will not receive their tax free refund at the exit point. Invoice wallets will be handed to tourists at the stores to keep their Tax Free Tag purchases organised.
What happens if the tourist claims their VAT refund and a relative then tried to refund or exchange the goods?
The person requesting the refund must be the person whose name and passport number is recorded in the Tax Free Tag transaction. The return of goods is allowed before the Tax Free Tag has been validated at the point of exit (the merchant will have to void the Tax Free Tag following Planet's procedures). Returns are not allowed after the tourist has validated the Tax Free Tag at the point of exit from the UAE.
What happens when a tourist buys a goods in the UAE and returns the goods in participating stores in the UAE or abroad (if allowed by the merchant)?
Returns are allowed before the Tax Free Tag has been validated at the point of exit (the merchant will have to void the Tax Free Tag following Planet's procedures). Returns are not allowed after the tourist has validated the Tax Free Tag at the point of exit from the UAE.
What are the timings of the merchant support help line?
The merchant support help line will be available 7 days a week from 10am to midnight (and 2am for holidays when extended store hours are in place). Emails can be sent at any time.
Can a resident who has cancelled his resident visa and is on the grace period for one month claim VAT on items purchased after the visa is cancelled?
No.
Can someone other than the tourist validate the Tax Free Tag and collect the refund?
No, Only the owner of the passport/GCC ID under which the Tax Free Tag is registered is entitled to validate them and collect the refund.
Do goods have to be exported in original packaging?
No, but goods and original packaging will have to be available for inspection to confirm that the goods are newly purchased.
Does a tourist require the physical Tax Free Tag or can he save the image of the Tax Free Tag and invoice on the mobile phone?
The physical Tax Free Tag must be attached to the invoice at the point of exit (validation).
What does a tourist need to do to have the refund paid to the credit or debit card?
During validation the tourist will be asked to enter their card details. Refunds can be made to Visa, MasterCard, Amex and Union Pay.
How can the tourist collect their refund?
The tourist can have the refund paid to their credit or debit card or where available collect the refund in cash from a Planet cash refund agent. A tourist may also be able to claim the refund via e-vouchers at exit points where cash is not available. When validating a Tax Free Tag the tourist will choose their preferred refund method. A list of cash refund points can be found on the Planet website.
How can the tourist track their refund?
The tourist can track their refund by scanning the QR code on the Tax Free Tag using their smartphone, and this will take them to a unique website link that will show the refund status.
How does the tourist know which shops offer Tax Free shopping?
Look for stores displaying the Planet Tax Free and FTA logo, or ask in store.
How early can the tourist get their Tax Free Tag validated at the airport or port?
The validation point will begin accepting Tax Free Tags from 6 hours before the tourist's scheduled departure time.
How much does a tourist have to spend to qualify for Tax Free shopping?
The minimum purchase amount is AED 250 per Tax Free Tag. This can be made up of more than one purchase within the same store group on the same day.
How much is the refund?
The refund is 85% of the VAT minus 4.80 AED per Tax Free Tag.
How much time does the tourist have to export the goods and have the Tax Free Tag validated?
The tourist must export the goods and have the Tax Free Tag validated within 3 months of purchase otherwise a tax free refund is not possible.
If the tourist fails to obtain validation on exit, is there anything they can do?
The tourist can return to the UAE with the goods and obtain validation on their departure within 3 months from the date of purchase. Goods must not be consumed or partly consumed when requesting validation, and must be available for inspection.
Is there a limit on the number of items that a tourist can claim refund on? (e.g. 10 mobile phones)
No, however they should be for personal use or gifts. Purchases may be subject to increased checks if it is suspected that these goods are not for personal use.
Is there a maximum amount the tourist can spend?
No.
Should goods be available for inspection at the exit points?
Yes.
The tourist has obtained the Tax-Free Tag. What are the next steps?
The tourist must keep the Tax Free Tag attached to the invoice until their day of departure. On departure, the tourist must present their Tax Free Tag to a member of Planet staff or go to a Planet self-serve kiosk to have the Tax Free Tag digitally validated before checking in their luggage and going through security. At the end of the process, the tourist can choose whether they want a credit/debit card or cash refund.
What currency will the refund appear in on the tourist's card statement?
The refund will appear in the currency of the card.
What does a tourist need to do to collect their refund in cash?
After validation, the tourist presents their passport/ GCC ID and Tax Free Tags to a Cash Refund Agent. Planet staff will be able to direct the tourist to the nearest cash agent.
What happens if some goods are too large to carry and have to be shipped?
Goods must be available for inspection at the validation point. The validation point will be before check in, luggage drop-off and security. The goods must be accompanied by the tourist when leaving the UAE so if they are shipped via courier they are not eligible goods under this scheme.
What happens if the refund cannot be collected at the point of departure because there is no time or there is a long queue?
The Tax-Free Tag must be validated at departure or no refund can be made. However, a tourist can provide card details later to obtain the refund once goods have been validated if they didn't have time to get a refund.
What is validation or digital validation?
Validation is the confirmation that the goods have been exported and the VAT can be reclaimed for these purchases. This is done by Planet at the point of exit (either by the staff, or by self-serve kiosks) before the tourist checks in their luggage and goes through security. There may also be additional checks required after security.
Where are the export validation points?
Planet Validation points will be before check in and are branded Planet Tax Free. Initially these will be in Abu Dhabi, Dubai and Sharjah International Airports. The validation points will be open 24/7.
These will be followed by other validation points including Dubai Al Maktoum airport, Al Ain airport, Ras Al Khaimah airport, Port Zayed, Port Rashid, Al Ghuwaifat land border, Al Ain land border and Hatta land border
Will the tourist be able to claim a refund on things like restaurant meals or taxis?
No, only eligible goods can receive a Tax Free Tag for refund.
What goods are eligible?
All taxable goods are eligible except for:
Goods that have been consumed, in full or in part, in the UAE;
Goods that are not accompanied by the overseas tourist at the time of leaving the UAE;
Motor vehicles, boats and aircraft.
What if the tourist purchases the goods and then asks for the purchase to be added to an existing Tax-Free Tag? What if he asks on the following day?
The tourist can consolidate up to 8 receipts on the same day of purchase from the same store group.
