Salik To Apply 5% VAT On Toll Tariffs And Tag Activation Fees From June 1

Salik has announced that a 5 per cent value-added tax (VAT) will be applied to toll tariffs and tag activation fees starting June 1, 2026.

The Dubai-listed company confirmed that the VAT amount will be collected on behalf of the Federal Tax Authority (FTA) in accordance with UAE regulations.

VAT Will Not Change Base Toll Tariffs

Salik clarified that the underlying toll tariff structure will remain unchanged and that VAT is being treated as a pass-through charge remitted directly to the FTA.

The company added that the implementation of VAT will not affect its profitability or overall financial position moving forward.

According to Salik, retrospective VAT liabilities covering the period from July 1, 2022 to May 31, 2026 will be fully compensated by Roads and Transport Authority (RTA), ensuring no financial impact on the company for the previous period.

Announcement Follows Similar Move By Parkin

The announcement comes shortly after Parkin confirmed that a 5 per cent VAT would also be introduced on its parking services from June 1.

The move reflects wider VAT implementation measures across Dubai’s transport and mobility services sector.

Q1 2026 Financial Performance

Salik also released its first-quarter financial results for 2026.

The company reported:

• Net profit of Dh369.3 million
• Total revenue of Dh728.9 million
• Toll usage fee revenue of Dh625.5 million

Revenue declined by 3 per cent year-on-year amid softer traffic conditions during March, which the company linked to regional geopolitical tensions and military conflict affecting mobility trends.

Traffic Volumes Decline

According to the company:

• Total trips through Salik gates fell 6.4 per cent to 197.2 million
• Toll usage fee revenue declined 6 per cent year-on-year
• Tag activation fees increased 6.1 per cent to Dh12.2 million

The increase in tag activation revenue was supported by an 8.4 per cent rise in registered active vehicles.

Salik said the impact of softer traffic volumes was partially offset by the variable pricing mechanism introduced in January 2025.

Salik Fines Revenue

Revenue from fines reached Dh69.1 million during the first quarter of 2026, marking a modest 1 per cent increase compared to the same period last year.

The company attributed the slower growth in fines revenue to reduced traffic volumes during March.