The UAE applies the GCC common external tariff, which for most goods is 5% customs duty. Some goods are exempt, such as many basic foodstuffs and medicines, and a few carry much higher rates, tobacco and alcohol among them. Then VAT at 5% applies to the import as well. This post walks through the general case; your clearing agent or the customs authority will confirm the rate for your specific product's HS code.
Step 1: the CIF value
Duty is charged on the CIF value: the cost of the goods plus the freight and insurance to the UAE. If your supplier quoted FOB, add the freight and insurance yourself. If they quoted CIF, that is already your starting figure. (What FOB and CIF mean.) Convert it into dirhams.
Step 2: customs duty
Multiply the CIF value by the duty rate — 5% for most goods.
Step 3: VAT
VAT on an import is 5% of the CIF value plus the duty. Businesses registered for VAT generally do not pay this at the border in cash: they account for it on their VAT return through the reverse-charge mechanism, provided their TRN is linked to their customs registration, and can usually recover it in the same return. Buyers who are not VAT-registered pay it and cannot recover it, so for them it is a real cost.
A worked example
- Goods, freight and insurance to Jebel Ali (CIF): AED 40,000
- Customs duty at 5% of 40,000: AED 2,000
- VAT at 5% of (40,000 + 2,000): AED 2,100
- Clearing agent, port and handling charges: varies — ask for a quote; budget a few hundred to a few thousand dirhams depending on the shipment
- Delivery from port to your warehouse: varies by size and distance
So goods that cost AED 40,000 landed at the port cost about AED 42,000 plus clearing and delivery for a VAT-registered buyer who recovers the VAT, and about AED 44,100 plus those fees for one who cannot. Those few thousand dirhams are often what decides whether importing beats buying from a local trader.
Compare landed cost to landed cost. A factory price against a delivered local price is not a comparison, it is a guess.
Free zones
Goods brought into a free zone are generally not charged customs duty while they stay there. Duty becomes due when they move from the free zone into the mainland. If your supplier or warehouse is in a free zone, ask where the duty will be paid and by whom.
Quick answers
Do I need anything to import goods into the UAE? Yes: a trade licence that allows importing and a customs registration (an importer code) with the customs authority of the emirate. Many small buyers use a clearing agent, who can advise on this.
Is duty charged on goods from other GCC countries? Goods of GCC national origin moving between GCC states are generally exempt from duty, with the right certificate of origin.
Comparing local and overseas quotes
Our AI procurement platform collects quotes from local suppliers by phone and from overseas suppliers by email and WhatsApp, and converts each one into your currency at the rate on the day it was given, keeping the original beside it. The landed-cost arithmetic above is what turns those two lists into one decision. See plans and prices.