DCG confirms customs duty exemption on IT products

Dubai Customs effects duty changes although 1% service charge still applies

Tags: Dubai Computer GroupDubai Computer Group (DCG) (www.dcgdubai.com/)Dubai Computer Traders Group
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DCG confirms customs duty exemption on IT products Duty exemption on IT products will increase business and the profitability of reseller companies in the Dubai channel, says Rughwani.
By  Manda Banda Published  January 11, 2012

The Dubai Computer Group (DCG) has announced the implementation of customs duty exemption on technology products.

The move follows two years of negotiations between the Dubai-based computer association and Dubai Customs.

The changes, which came into effect on 1st January 2012, will see a broad range of IT, consumer electronics and telecommunication products including computers, printers, components, IT accessories and other peripherals exempted from paying customs duty to Dubai Customs.

"We would like to announce the implementation of customs duty exemption on most of the IT products. We also would like to point out to our members and resellers in Dubai that a 1% service charge still applies on all duty exempted products as per the agreement between DCG and Dubai Customs," said Shailendra Rughwani, president of DCG. "I can confirm that the Dubai Customs has already implemented these changes in the Mirsal Systems."

In a statement to the local IT trade industry association, Dubai Customs confirmed that with effect from January, 2012, technological products are exempted from customs duty. However, the revenue authority outlined that a non-refundable service charge of 1% on the cost, insurance and freight (CIF) value of the commodities shall apply, subject to a maximum of AED20, 000 per declaration.

Dubai Customs also outlined that the following interim solutions will be in place in the Mirsal Systems, until the systems are modified to reflect all the changes:

      • > In case of import declarations, a service charge of 1% on their CIF value will be collected without any maximum limit on processing the declaration.
      • > In case the service charge collected is greater than AED20,000 per declaration, the amount collected in excess of AED 20, 000 will be credited back to the CDR account.
      • > In case of payment through ePayment option, a refund cheque will be issued to the client.
      • >In the case of import for re-export declarations, the 5% deposit shall continue to be collected which will be refunded back on the re-exportation of such products.
      • >In case of failure to re-export, only 1% of the deposit will be forfeited and the rest refunded back to the client.
      • >In case of payment understanding guarantee, only 1% service charge will be demanded.

    Rughwani said the DCG would like computer companies operating in Dubai to take advantage of this initiative by the Dubai Government and Dubai Customs. "We are upbeat that this will increase business and profitability of reseller companies in the Dubai channel," he said.

    2622 days ago

    This rule will benefit those who are selling only in local markets since they are only importing but to those who are sending goods outside Dubai and are using import for re export will not be benefited.

    2775 days ago
    Taiseer Edited by ITP.net

    Its was expected eventualy took place with psotive and as well as negative impact on business. Positive Side * Comparatively stable pricing * C Duty Tranparency * Growth of SMB and Mid Market Channel * Local Availablity of Products through Trade Counters from Main Distributors Negative Side * Tier Structuring will be lost * Redistribution Model will be weakened * More strain distbutor next 2 quarter on stablization for number * More work at Credit Department of Distributors as well as Credit Insurance companies But eventually things will cool down and will contribute in the IT Channel Growth of the UAE

    2775 days ago
    vinod mehra

    This is a bold move by Dubai Customs but their is fear of concerns being raised by others in the market for similar concessions else dissatisfaction will prevail.


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