Salik Announces 5% VAT From June 1 On Toll Tariff, Tag Activation

Dubai's sole toll gate operator Salik on Friday announced that it will implement a five per cent value-added tax (VAT) on toll tariffs and tag activation fee.

“The VAT amount will be remitted to the Federal Tax Authority ("FTA") in accordance with the applicable laws and regulations in the UAE,” the company said.

This announcement comes after Dubai's largest parking operator Parkin on Friday (May 22) announced that a VAT of 5 per cent will be applied to all parking services provided by the operator starting June 1.

“The VAT amount will be remitted to the Federal Tax Authority (FTA) in accordance with the applicable laws and regulations in the UAE,” Salik said.

The Dubai-listed company confirmed that the underlying tariff structure remains unchanged, and that VAT represents a pass-through item collected on behalf of the FTA.

It added that the implementation of VAT from June 1, 2026 will not have any impact on the company's profitability or overall financial position on a go-forward basis.

“As per the previously agreed mechanism, the company confirms that the Retrospective VAT amount, for the period of July 1, 2022 till May 31, 2026, will be fully compensated by RTA resulting in no financial impact to Salik for this period. Salik will continue to maintain the highest standards of regulatory compliance, transparency, and disclosure, and will provide further updates to the market if required in accordance with applicable regulatory requirements,” it said in a statement on Friday.

The company's net profit for the first quarter of 2026 remained broadly stable at Dh369.3 million amid a more moderate operating environment in March caused by the regional military conflict.

Total revenue for Q1 2026 stood at Dh728.9 million, a 3.0 per cent year-on-year decline, reflecting lower toll usage fees due to softer traffic trends during the quarter resulting from the exceptional event that impacted March performance. This was partially offset by growth in tag activation fees and other revenue streams.

Tag activation fees increased 6.1 per cent in Q1 2026 to reach Dh12.2 million, supported by an 8.4 per cent year-on-year increase in registered active vehicles.

Toll usage fees totalled Dh625.5 million in Q1 2026, representing a 6.0 per cent decline, primarily due to softer traffic trends during the quarter, partially offset by the continued impact of the variable pricing mechanism introduced in late January 2025.

The total number of trips, including discounted trips, made through Salik's toll gates fell 6.4 per cent to 197.2 million in Q1 2026, reflecting a more moderate traffic environment amid evolving regional market dynamics in March.

Salik fines reached Dh69.1 million in the first quarter of 2026, up just 1 per cent compared to the same period last year, as total chargeable trips declined in March due to softer traffic following the regional conflict.

Salik fines steady as traffic stays softer during Q1 amid regional conflict Dubai's Parkin announces 5% VAT to all parking services starting June 1 UAE motorists can soon pay for valet parking through Salik

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