What conditions must be met to zero-rate an export of services?

Article 31 – Zero-rating the Export of Services 18 1. The Export of Services shall be zero-rated in the following cases: a. If the following conditions are met: 1) The Services are supplied to a Recipient of Services who does not have a Place of Residence in an Implementing State and who is outside the State at the time the Services are performed, 2) The Services are not supplied directly in connection with real estate situated in the State or any improvement to the real estate or directly in connection with moveable assets situated in the State at the time the Services are performed, and 3) The Services are not treated as being performed in the State or in a Designated Zone under Clauses 3 to 8 of Article 30 and Article 31 of the Decree-Law. b. If the services are actually performed outside the Implementing States or are the arranging of services that are actually performed outside the Implementing States. c. If the supply consists of the facilitation of outbound tour packages, for that part of the service. 2. For the purpose of paragraph (a) of Clause 1 of this Article, a Person shall be considered as being “outside the State” if they only have a presence in the State of less than 30 (thirty) days and the presence is not effectively connected with the supply.19 3. As an exception to paragraph (a) of Clause 1 of this Article, a supply of Services shall not be zero-rated, if the supply is made under an agreement that is entered into, whether directly or indirectly, with a Recipient of Services who is a Non-Resident, if the following two conditions are met: a. The performance of the Services is, or it is reasonably foreseeable that the performance of the Services will be, received in the State by another Person, including but not limited to, an employee or a director of the Non-Resident Recipient of Services. 18 Article amended as per Cabinet Decision No. 100 of 2024. 19 Clause amended as per Cabinet Decision No.46 of 2020. Cabinet Decision No. 52 of 2017 and its amendments – As published by the Ministry of Finance 25 b. It is reasonably foreseeable, at the time the agreement is entered into, that the other Person in the State will receive Services for which Input Tax is not recoverable in full under Article 54 or Article 57 of the Decree-Law. 4. For the purposes of paragraph (c) of Clause 1 of this Article, services that consist of the “facilitation of outbound tour packages” means the services that a Taxable Person provides in packaging one or more tourism products and also services outside the Implementing States, including but not limited to such goods and services as accommodation, meals, transport, and other activities.

Article 57 - Recovery of Tax by Government Entities and Charities25 1. Without prejudice to the general provisions of Input Tax recovery, Government Entities and Charities entitled to recover the full amount of Input Tax shall be determined in a Cabinet Decision issued upon the recommendation of the Minister, according to the following: a. Input Tax paid by the Government Entity for the purposes of its sovereign activities. 25 Article amended as per Federal Decree-Law No. 18 of 2022. Federal Decree-Law No. 8 of 2017 and its amendments – As published by the Ministry of Finance 28 b. Input Tax paid by the Charity for the purposes of its Relevant Charitable Activity. 2. As an exception to the provisions of Clause 1 of this Article, the following shall be excluded from recovery: a. Tax excluded from recovery as specified in the Executive Regulation of this Decree-Law. b. Tax paid for Goods and Services used to perform Exempt Supplies. Chapter Two – Apportionment and Adjustment of Input Tax

Article 31 - Place of Supply of Telecommunication and Electronic Services 1. For telecommunications and electronic Services specified in the Executive Regulation of the Decree-Law, the place of supply shall be: a. In the State, to the extent of the use and enjoyment of the supply in the State. b. Outside the State, to the extent of the use and enjoyment of the supply outside the State. 2. The actual use and enjoyment of telecommunications and electronic Services shall be where the Services were actually used regardless of the place of contract or payment. Chapter Three – Place of Residence

Article 32 – Zero-Rating Exported Telecommunications Services 1. The export of telecommunications services shall be subject to the zero rate in the following situations: a. A supply of telecommunications services by a telecommunications supplier who has a Place of Residence in the State to a telecommunications supplier who has Place of Residence outside the Implementing States. b. A supply of telecommunications services by a telecommunications supplier who has a Place of Residence in the State to a Person who is not a telecommunications supplier and who has Place of Residence outside the State for a telecommunications service that is initiated outside the Implementing States. 2. For the purposes of paragraph (b) of Clause 1 of this Article, the place where a supply is initiated shall be identified according to the following: a. The place of the Person who commences the supply. b. If paragraph (a) of this Clause does not apply, the Person who pays in return for the services. c. If paragraphs (a) and (b) of this Clause do not apply, the Person who contracts for the purposes of the supply. 3. For the purposes of this Article, a “telecommunications supplier” means a Person whose main activity is the supply of telecommunications services.