What is the penalty for not displaying prices inclusive of VAT?

Table No. 3 On Violations and Administrative Penalties related to the Implementation of Federal Decree-Law No. 8 of 2017 on Value Added Tax No. Description of Violation Administrative Penalty in AED 1 The failure of the Taxable Person to 5,000 display prices inclusive of Tax. 2 The failure of the Taxable Person to 2,500 notify the Authority of applying Tax based on Margin. 3 The failure to comply with the The penalty shall be the higher of 50,000 required conditions and procedures or 50% of the Tax, if applicable, chargeable related to keeping the Goods in a on the goods in relation to the violation. Designated Zone or moving them to another Designated Zone. 4 The failure of the Taxable Person to 2,500 for each detected case. issue a Tax Invoice or the alternative document when making any supply. 5 The failure of the Taxable Person to 2,500 for each detected case. issue a Tax Credit Note or the alternative document. 6 The failure of the Taxable Person to 2,500 for each detected case. comply with the conditions and procedures regarding the issuance of a Tax Invoice and a Tax Credit Note electronically. Cabinet Decision No. 49 of 2021 - Issue Date: 28 April 2021 - Unofficial Translation 7

2.4. Price display Cars are often displayed by motor vehicle traders in their showrooms. For sales of cars to the public, a motor trader vehicle must display, advertise, publish or quote VATinclusive prices. This is required so that the customer knows upfront the price that is payable for the car. For example, if the car is priced at AED 100,000 and the VAT applicable on the sale is AED 5,000, a motor vehicle trader must advertise the price as AED 105,000 with a stipulation that the price includes VAT. There are two exceptions to the above rule where the advertised price is not required to be inclusive of VAT: (a) Where the supply of car is for export; and (b) Where the customer is registered for VAT. If any of the exceptions apply and a motor vehicle trader advertises the price as exclusive of VAT, it must clearly specify that the price is exclusive of VAT. 2.5. Sale of cars to foreign governments, international organisations, diplomatic bodies and missions Sale of cars to foreign governments, international organisations, diplomatic bodies and missions, or an official thereof, are also subject to VAT at 5%. The foreign governments, international organisations, diplomatic bodies, missions or an official thereof may, however, seek a refund of such VAT incurred under the special VAT refund 5 scheme prescribed in the VAT legislation. 5 Article 75(4) of the Decree-Law read with Article 69 of the Executive Regulation. Automotive Sector | VAT Guide | VATGAM1 8