Dubai Loses Glitter as VAT Tax Crimps Demand in City of Gold
- Sales fell 50% last quarter: Dubai Gold & Jewellery Group
- Gold souk shops available to rent for first time in years
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Demand for gold jewelry in the United Arab Emirates plummeted in the first quarter, and traders say they know the culprit: the value-added tax.
Wholesale gold jewelry sales in Dubai, sometimes known as the City of Gold, fell 50 to 60 percent in the first quarter from a year earlier after VAT began on Jan. 1, according to Chandu Siroya, vice chairman of the industry association Dubai Gold & Jewellery Group. Dubai’s historic souk marketplace of mostly jewelry traders even has space available for the first time in years, he said.