Following UAE Federal Decree-Law No. (8) of 2017 on Value Added Tax and its Executive Regulations, on 28 December 2017, His Highness Shaikh Mohammed bin Rashid Al Maktoum issued Cabinet Decision No. (56) of 2017 on Medications and Medical Equipment Subject to Tax at Zero Rate (the Cabinet Decision).

The Cabinet Decision states that the supply of "Medications" and "Medical Equipment" that are registered with the UAE Ministry of Health and Prevention (the Ministry), or imported with the permission of the Ministry, shall be subject to tax at zero rate.

The Cabinet Decision defines "Medications" and "Medical Equipment" as follows:

Medications: Every product containing a substance(s) which achieves the intended objective in or on the human body via biological effect, which is produced, sold or offered for use in cases relating to diagnosing, treating, healing, relieving or preventing diseases, or renewing, correcting or rehabilitating the function of body organs.

Medical Equipment: A medical product containing a substance, device, instrument, motor, implant, detector or system, including its accessories and operating software, which achieves the intended objective in or on the human body without medicinal, immunological or metabolic effect, which is produced, sold or offered for use in cases relating to diagnosing, treating, relieving, controlling or preventing diseases, injury or disability.

The Cabinet Decision became effective on 1 January 2018.