The United Arab Emirates has launched the world’s first VAT refund system for tourists who make online purchases during their stay in the country.

According to the UAE Federal Tax Authority (FTA), the system was introduced in partnership with Planet, an authorized operator of the tax-free program for foreign travelers.

The system is fully paperless and constantly updated. It operates through a digital platform where tourists can scan their passports, make purchases, and automatically share receipts.

Tourists can claim VAT refunds for purchases made both in traditional stores and on online e-commerce platforms. To do so, they must upload personal documents and receipts to the platform.

The VAT refund process takes place after the foreign guest's identity is verified during delivery or the completion of an online order.

The VAT Refund (Tax-Free) system was announced in the UAE in 2018. Tourists who buy goods in the UAE can claim a VAT refund within 90 days after making the purchase.

The maximum amount for a cash refund is capped at 7,000 AED (approximately US$ 1,900). There is no upper limit for refunds made to a credit card.

To qualify for a VAT refund, the tourist (or any person not a UAE resident) must be of legal age, leave the UAE within three months of making the purchase, and take the goods with them.

However, VAT refunds do not apply to airline crew members. Additionally, VAT cannot be refunded for yachts, cars, motorcycles, or airplanes. It is also not available if the goods were partially or fully consumed (used) within the UAE.